[Senate Hearing 107-853]
[From the U.S. Government Publishing Office]



                                                        S. Hrg. 107-853

                  MISCELLANEOUS WATER AND POWER BILLS

=======================================================================

                                HEARING

                               before the

                    SUBCOMMITTEE ON WATER AND POWER

                                 of the

                              COMMITTEE ON
                      ENERGY AND NATURAL RESOURCES
                          UNITED STATES SENATE

                      ONE HUNDRED SEVENTH CONGRESS

                             SECOND SESSION

                                   on

                                     

                           S. 934                                S. 2696
 
                           S. 1577                               S. 2773
 
                           S. 1882                               H.R. 2990
 
                           S. 2556
 

                                     
                               __________

                             JULY 31, 2002


                       Printed for the use of the
               Committee on Energy and Natural Resources


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               COMMITTEE ON ENERGY AND NATURAL RESOURCES

                  JEFF BINGAMAN, New Mexico, Chairman
DANIEL K. AKAKA, Hawaii              FRANK H. MURKOWSKI, Alaska
BYRON L. DORGAN, North Dakota        PETE V. DOMENICI, New Mexico
BOB GRAHAM, Florida                  DON NICKLES, Oklahoma
RON WYDEN, Oregon                    LARRY E. CRAIG, Idaho
TIM JOHNSON, South Dakota            BEN NIGHTHORSE CAMPBELL, Colorado
MARY L. LANDRIEU, Louisiana          CRAIG THOMAS, Wyoming
EVAN BAYH, Indiana                   RICHARD C. SHELBY, Alabama
DIANNE FEINSTEIN, California         CONRAD BURNS, Montana
CHARLES E. SCHUMER, New York         JON KYL, Arizona
MARIA CANTWELL, Washington           CHUCK HAGEL, Nebraska
THOMAS R. CARPER, Delaware           GORDON SMITH, Oregon

                    Robert M. Simon, Staff Director
                      Sam E. Fowler, Chief Counsel
               Brian P. Malnak, Republican Staff Director
               James P. Beirne, Republican Chief Counsel
                                 ------                                

                    Subcommittee on Water and Power

                BYRON H. DORGAN, North Dakota, Chairman
BOB GRAHAM, Florida                  GORDON SMITH, Oregon
RON WYDEN, Oregon                    JON KYL, Arizona
TIM JOHNSON, South Dakota            LARRY E. CRAIG, Idaho
DIANNE FEINSTEIN, California         BEN NIGHTHORSE CAMPBELL, Colorado
MARIA CANTWELL, Washington           RICHARD C. SHELBY, Alabama
THOMAS R. CARPER, Delaware           CHUCK HAGEL, Nebraska

  Jeff Bingaman and Frank H. Murkowski are Ex Officio Members of the 
                              Subcommittee

                Patty Beneke, Democratic Senior Counsel
                        Colleen Deegan, Counsel


                            C O N T E N T S

                              ----------                              

                               STATEMENTS

                                                                   Page

Baucus, Hon. Max, U.S. Senator from Montana......................     4
Bingaman, Hon. Jeff, U.S. Senator from New Mexico................    22
Burns, Hon. Conrad, U.S. Senator from Montana....................     7
Carlson, Peter, Coordinator, Small Reclamation Program Act 
  Coalition......................................................    39
Chavez, Martin J., Mayor, Albuquerque, NM........................    46
Craig, Hon. Larry E., U.S. Senator from Idaho....................     3
Crapo, Hon. Mike, U.S. Senator from Idaho........................     5
Dorgan, Hon. Byron L., U.S. Senator from North Dakota............     1
Groat, Charles G., Director, U.S. Geological Survey, Department 
  of the Interior................................................    19
Hagel, Hon. Chuck, U.S. Senator from Nebraska....................     2
Halbert, Wayne, General Manager, Harlingen Irrigation District, 
  Cameron County #1, Harlingen, TX...............................    50
Keil, Dan, Chairman, North Central Montana Regional Water 
  Authority, Conrad, MT..........................................    25
Keys, John W., III, Commissioner, Bureau of Reclamation, 
  Department of the Interior.....................................     8
Raybould, Jeff, Chairman, Board of Directors, Fremont-Madison 
  Irrigation District, St. Anthony, ID...........................    37
Scholle, Peter, Ph.D., State Geologist and Director, New Mexico 
  Bureau of Geology and Mineral Resources, New Mexico Institute 
  of Technology, Socorro, NM, accompanied by M. Lee Allison, 
  Ph.D., State Geologist and Director, Kansas Geological Survey, 
  University of Kansas, Lawrence, KS.............................    53
Smith, Hon. Gordon, U.S. Senator from Oregon.....................     2
Sunchild, Bruce, Sr., Vice Chairman, Chippewa Cree Tribe, Box 
  Elder, MT......................................................    30

                                APPENDIX

Additional material submitted for the record.....................    63

 
                  MISCELLANEOUS WATER AND POWER BILLS

                              ----------                              


                        WEDNESDAY, JULY 31, 2002

                               U.S. Senate,
                   Subcommittee on Water and Power,
                 Committee on Energy and Natural Resources,
                                                    Washington, DC.
    The subcommittee met, pursuant to notice, at 2:33 p.m. in 
room SD-366, Dirksen Senate Office Building, Hon. Byron L. 
Dorgan presiding.

          OPENING STATEMENT OF HON. BYRON L. DORGAN, 
                 U.S. SENATOR FROM NORTH DAKOTA

    Senator Dorgan. Welcome to the hearing of the Subcommittee 
on Water and Power. The subcommittee will receive testimony on 
several pending bills relating to various water resources and 
matters in the West. I look forward to learning more about 
these bills which address topics ranging from rural water 
supply to specific water projects.
    The bills that we will hear about today are S. 934, to 
require the Secretary of the Interior to construct the Rocky 
Boy's North Central Mountain Regional Water System in the State 
of Montana, and for other purposes; S. 2556, to authorize the 
Secretary of the Interior to convey certain facilities to the 
Fremont-Madison Irrigation District of the State of Idaho; S. 
1882, to amend the Small Reclamation Projects Act of 1956, and 
for other purposes; S. 1577 and H.R. 2990, to amend the Lower 
Rio Grande Valley Water Resources Conservation and Improvement 
Act of 2000, to authorize additional projects under that Act, 
and for other purposes; S. 2696, to clear title to certain real 
property in New Mexico associated with the Middle Rio Grande 
project, and for other purposes; and S. 2773, to authorize the 
Secretary of the Interior to cooperate with the High Plains 
Aquifer States in conducting hydrogeologic characterization, 
mapping, modeling and monitoring program for the High Plains 
Aquifer, and for other purposes.
    I am pleased to see my colleagues here today to discuss 
these important bills, and I especially appreciate Commissioner 
Keys and Director Charles Groat being here to testify on behalf 
of the administration. In addition, I know that several of the 
witnesses have traveled long distances in order to provide 
testimony to us, and we very much appreciate your willingness 
to be here as well.
    We will now turn to my colleagues to see if they have 
opening statements. I would like to request that when we hear 
witnesses today, you will summarize your statements to no more 
than 5 minutes, and all the prepared written statements will be 
made a part of the permanent record. Let me call on my 
colleague, Senator Craig.
    [The prepared statements of Senators Hagel and Smith 
follow:]
   Prepared Statement of Hon. Chuck Hagel, U.S. Senator From Nebraska
    I thank the Chairman for holding this hearing to examine several 
bills related to water projects. At a time when the country is facing 
its worst national drought in decades, the importance of the country's 
water resources becomes even more apparent.
    One of the bills being reviewed today, S. 2773, would direct the 
U.S. Geological Service to conduct a mapping, modeling and monitoring 
program for the High Plains Aquifer, also known as the Ogallala 
Aquifer. Of the eight states that have some portion of their land over 
the aquifer, Nebraska has the most--approximately 64,400 square miles, 
about 83 percent of the state.
    Mr. Chairman, I do not disagree that we need better science on the 
High Plains Aquifer and its water levels. The aquifer is a major source 
of irrigation and drinking water, and it is an essential resource to 
all who live in this region of the country.
    Despite the need for more information, however, we must have the 
cooperation and support of the states affected, as well as their water 
resource agencies. A previous version of this legislation was opposed 
by Nebraska's Department of Natural Resources. The department believed 
the legislation would have permitted the federal government to unduly 
influence state programs and state law.
    Most of the opposed language from the previous version of this 
legislation does not appear in S. 2773. However, this bill still needs 
improvement.
    One of my concerns with the legislation is the potential costs to 
the states, especially at a time when many states--including Nebraska--
are experiencing severe budget shortfalls. Also, under this bill, one 
lone state could put forth recommendations that would affect many other 
states, without consent of the affected states. Finally, this bill--
while written with good intentions--could eventually lead to the 
erosion of state sovereignty in regard to water laws, allowing the 
federal government to intervene in state groundwater use.
    The Western States Water Council--representing the governors of 
eighteen states--has suggested sensible language changes to S. 2773. 
These changes would improve the bill, and make S. 2773 more acceptable 
to Nebraska. I have provided these recommendations to both the majority 
and minority staffs, and I encourage the members of this subcommittee 
to review them.
    I look forward to working with the authors of S. 2773 to improve 
this bill, and help enact sensible legislation that will enable us 
better understand and use wisely our groundwater resources.
    Thank you.
                                 ______
                                 
   Prepared Statement of Hon. Gordon Smith, U.S. Senator From Oregon

    Mr. Chairman, I appreciate your convening this legislative hearing 
today on various water-related bills pending before the Subcommittee 
today. Several of these bills are site-specific in nature, and I'm sure 
they are very important to solving local water supply or water quality 
issues. I would like to welcome the Commissioner of Reclamation, John 
Keys, and the Director of the U.S. Geological Survey, Dr. Charles 
Groat, as well as all the other witnesses who will provide testimony 
today.
    One of the bills to be heard today is S. 1882, a bill which I 
introduced to amend and update the Small Reclamation Projects Act of 
1956. The underlying Act established Reclamation's small loan program, 
and was used successfully for decades by eligible water districts for 
smaller projects.
    During the last Administration, a decision was made not to accept 
any more loan applications for this program, despite the remaining 
funds of over $200 million under the current authorization ceiling.
    This effort to update the program is a recognition that the funding 
needs for many irrigation districts and other eligible entities have 
changed in recent years. As a result of threatened and endangered 
species, as well as higher environmental standards, water users are 
being called on to modify their conveyance and distribution systems, to 
screen diversions, and to mitigate for certain project impacts.
    Generally speaking, these are not the types of projects that are 
attractive to commercial lenders. The small loan program, as updated by 
this bill, can provide an important funding source for the types of 
investments we are requiring water users to make.
    I would like to submit for the record letters of support for S. 
1882 that I have received from the National Water Resources Association 
and the Association of California Water Agencies.
    I look forward to hearing from the witnesses here today.

        STATEMENT OF HON. LARRY E. CRAIG, U.S. SENATOR 
                           FROM IDAHO

    Senator Craig. Well, Mr. Chairman, first of all, thank you 
for holding this hearing. As the session draws toward an end we 
have several pieces of legislation that with hearing and markup 
can become law this year. The one that I am speaking to is S. 
2556. That's an important piece of legislation for Idaho and 
especially southeastern Idaho.
    Jeff Raybould, from that area, is serving as chairman of 
the board of directors of the Fremont-Madison Irrigation 
District, and is here to speak to that legislation.
    I'm also joined by my colleague Mike Crapo. Both he and I 
have worked on this issue here on the Senate side, recognizing 
how important it is that when these Bureau of Reclamation 
projects have been paid out, that we honor the commitment 
initially made in the law years ago that they would then be 
turned over to the managing entity, in this instance the 
Fremont-Madison Irrigation District, and that's what this 
legislation does.
    Our colleagues in the House, Mike Simpson and Butch Otter 
have already moved this legislation. What we're dealing with is 
identical legislation, so if we are successful here in the 
Senate, then this can become law this year. We have been able 
to transfer title now to, this will be the third district in 
our State, as I say, responding to the intent of the original 
law. At the same time, working with these districts to assure 
that the integrity of the project, its environmental 
sensitivity and all that goes with an efficiently run 
irrigation district to supply quality water, at the same time 
recognizing its responsibility to the region is insured within 
the passage of this legislation.
    Now this kind of an approach is not without critics and so 
when Mr. Raybould comes before us today to offer testimony, I 
will ask him some questions relating to this particular project 
and what it means to the upper valley area of southeastern 
Idaho.
    Again, Mr. Chairman, thank you very much. Reclamation 
projects are important to the West and in a time of drought, we 
learn that lesson all over again. And I know your State and 
mine, but yours especially is experiencing very short water 
years this year, as is true of other States in the upper 
midwest. Again, thank you very much.
    Senator Dorgan. Senator Craig, thank you very much. We have 
Senator Crapo with us today, as well as Senator Baucus, and if 
the two of you would wish to make statements at the start of 
the hearing, we would be happy to receive those statements. Why 
don't you please take seats at the witness table. Senator 
Baucus, we will recognize you first, followed by Senator Crapo. 
Your entire statements will be made part of the record and you 
may summarize.

          STATEMENT OF HON. MAX BAUCUS, U.S. SENATOR 
                          FROM MONTANA

    Senator Baucus. Thank you very much, Mr. Chairman and 
Senator Craig. I am here to testify on behalf of S. 934, a bill 
introduced along with my colleague, Senator Burns. This 
legislation authorizes the North Central Regional Water System 
construction project and addresses the lack of water, lack of 
quality water supply for the Chippewa Cree tribe and six 
additional counties in Montana: Chouteau, Hill, Liberty, 
Pondera, Teton, and Toole Counties.
    I also would like to extend a very warm welcome to those 
Montanans who have traveled great distances. Of those, some of 
them here that you have referred to, Mr. Chairman, have come 
great distances, and I would like them all to stand when I 
mention their names.
    Dan Keil, who is chairman of the North Central Montana 
Regional Water Authority. Stay standing. Bruce Sunchild, and 
Dan Belcourt with the Rocky Boy, and also Dave Jones, who is 
the co-chair of the North Central Montana Regional Water 
Authority. These folks, and I know all of them, I have known 
all of them a long time. These folks are very committed. And 
they've got a problem and it's up to us to help solve it. Thank 
you guys, very much.
    Here's the problem. The problem is that as you know, Mr. 
Chairman, we're in the part of the country west of the 100th 
Meridian where it doesn't rain. You know, there is about 40 
inches of annual precipitation back here in Washington, D.C. It 
gets pretty muggy sometimes in the summers, as we all know. But 
in our part of the country, particularly western North Dakota, 
you and I have discussed this, Mr. Chairman, along with eastern 
Montana, it is just dry. It is part of our country that just 
does not get very much rainfall. That's number one.
    And number two, our State per capita income is down at the 
bottom of the barrel statewide. You can guess what it's like in 
eastern Montana, like I'm sure it is in western North Dakota. 
Sixty years ago Montana ranked 10th in the Nation in per capita 
income. We're now 47th. So we are struggling, there is not a 
lot of water, it doesn't rain very much, we are in a drought 
situation, we are low income, and we just need some help here.
    And I might say that all of us here are working for 
everybody in Idaho, in North Dakota and Montana--I had six of 
them stand up, but we all have people in our own States that we 
could have stand up, but it's up to us to find a solution.
    Just picture this. What was it like during the 1930's when 
there was no water, you know, drought? You had to go carry 
water great distances, trying to find drinking water. There 
just wasn't any. And even before that, the west was developed, 
there was just no running water, no drinking water.
    Now of course we have some areas of our State, or of all of 
our States, that have water supplies. But when drought 
conditions occur, it is just so much worse than it otherwise 
has been in the past. In addition to that, there are systems in 
Montana, water systems, which are on EPA's short list, that is, 
if they don't get their act together, EPA is going to start 
citing them for contamination reasons or pollution reasons, and 
that's just because there is so little water and it's over 
subscribed, and we just need to get water systems to these 
locations, particularly Rocky Boy and also the surrounding 
private communities, which leads me to another point.
    This is a joint partnership, this is not just water systems 
for the Rocky Boy and is the case in other parts of Montana for 
systems for the tribes. This is joint. This is people on and 
off reservation working together, because they all need water 
and they all need water desperately, really desperately. And to 
make this a little more poignant, there's a source, it's called 
Tiber Dam, it's close by. And so the idea is to take water from 
Tiber and put it into the system. It's a joint system strongly 
supported by members and non-members, by the surrounding 
community.
    The only problem, of course, is really twofold. One I might 
say, I have highest respect for the Bureau of Reclamation, but 
all agencies get a little bit stuck in their ways. I don't 
fault them because everybody who works for the Federal 
Government, 99 percent are trying to do a good job, they are 
trying to do what's right. I'm not one of these people that 
bashes Federal employees, I just don't go in for that, because 
I know they try hard.
    But I also know, because we all know it from experience, 
that all organizations, public and private, sometimes get a 
little bit hide bound and you've got to light a little fire 
under their feet to get them going, and that's what we have to 
do here with the BOR but in a cooperative way, a tone of 
working together with both the tribe and the non-tribal 
members, and the same approach should be taken here with BOR, 
and of course it's finding the resources to get this project 
underway.
    I strongly encourage your committee, with all due deference 
and respect, Mr. Chairman, to work with me and with Senator 
Burns, and with Congressman Rehberg over in the House, to 
figure out a way where we can skin this cat. Let's get started 
here. Let's get this project going, because it is so 
desperately needed. And if we could get it going, at least the 
authorization by this year, it would make a great deal of 
difference to an awful lot of folks and has been said in other 
contexts, it would be a good down payment. Thank you, Mr. 
Chairman.
    Senator Dorgan. Senator Baucus, thank you very much. Well 
said.
    Senator Crapo.

          STATEMENT OF HON. MIKE CRAPO, U.S. SENATOR 
                           FROM IDAHO

    Senator Crapo. Thank you, Mr. Chairman and Senator Craig 
and Senator Burns, Senator Baucus and members of the committee. 
I appreciate the opportunity to testify before you today on S. 
2556, the Fremont-Madison Conveyance Act. I want to 
particularly express my appreciation to Senator Craig, my 
colleague from Idaho. He and I as cosponsors of this 
legislation, have worked on it a long time, and hopefully we 
are at the point where we have worked through all of the 
wrinkles and we are at a stage where we can proceed now 
expeditiously to facilitate this title transfer.
    I also want to express my appreciation to Mr. Jeff 
Raybould, who is the president of the board of directors of 
Fremont-Madison Irrigation District, who will be testifying 
today on a later panel. Jeff will be providing a fuller account 
of the history of FMID's operations and the development of this 
conveyance proposal, so I will keep my remarks here brief.
    S. 2556 would require the Secretary of the Interior to 
convey title to portions of the district, namely the Cross Cut 
Diversion Dam, the Cross Cut Canal, and the Teton Exchange 
Wells. These are currently under the ownership of the Bureau of 
Reclamation.
    The district has managed these facilities since their 
creation in 1938, and by all accounts has done an excellent job 
of maintaining and operating the facilities. FMID also has a 
strong record of working within the community to manage the 
facilities in a manner that reflects and complements the unique 
ecological surroundings in which they reside.
    Over the past few years, representatives of the district 
have worked with local citizens, agriculture interests, the 
Bureau of Reclamation, and conservation groups to create a 
transfer agreement that would be acceptable to all interested 
parties, and we do have some further discussion to have which 
I'm sure Senator Craig will engage in today to clarify the 
issues, but I commend all of the parties for their work on such 
a delicate and complex process, and I look forward to 
continuing work with them as this legislation proceeds through 
the legislative process.
    Mr. Chairman, this measure is critically important to the 
people of eastern Idaho and reflects the spirit pioneered by 
this committee in partnership with the Bureau of Reclamation to 
advance previous title transfer proposals. I commend your 
leadership in calling this hearing and offer my services to the 
committee as it works forward to enact this provision. Thank 
you very much, Mr. Chairman.
    Senator Dorgan. Senator Crapo, thank you too for your 
consideration today and your contributions. Do you have any 
questions, Senator Craig, or Senator Burns?
    Senator Burns. No, I have no questions.
    Senator Craig. Where is Rocky Boy on the map?
    Senator Baucus. North central Montana.
    Senator Dorgan. Closest town that I might recognize?
    Senator Baucus. Havre.
    Senator Craig. Okay, thank you. I appreciate it.
    Senator Baucus. I note that the entire Idaho Senate 
delegation is here, which shows the importance of that project, 
and the entire Montana Senate delegation is here, showing the 
importance of this Montana project.
    Senator Dorgan. Well, I know how hard both delegations have 
worked on these issues, and your participation at our committee 
hearing today is much appreciated. We understand that you have 
other things to do, so we will let you go and we will be 
hearing from your constituents in a bit, but thank you for your 
contribution.
    Senator Baucus. And we will let you get this passed. Thank 
you.
    Senator Dorgan. Thank you very much. Next we call the 
Honorable John Keys, Commissioner of the Bureau of Reclamation; 
the Honorable Charles G. Groat, Director, U.S. Geological 
Survey. As they come forward and take their seats, let me call 
on Senator Burns.
    Would you have an opening statement, Senator Burns?

         STATEMENT OF HON. CONRAD BURNS, U.S. SENATOR 
                          FROM MONTANA

    Senator Burns. Mr. Chairman, thank you very much for 
holding this hearing today. We appreciate that very much, and I 
will put my full statement in the record to shorten the time. 
We want to hear from the witnesses.
    We want to thank the delegation that came in from Montana, 
both the folks who represent the water district up there, the 
newly formed water authority, and of course those folks, this 
means a lot for the folks on the reservation and we hope that 
this gets funded and gets done right away, and I appreciate you 
having this hearing and thank you very much.
    [The prepared statement of Senator Burns follows:]

   Prepared Statement of Hon. Conrad Burns, U.S. Senator From Montana

    First, I would like to thank the Chairman of this Subcommittee, 
Senator Dorgan, for holding this hearing. This project has been a long 
time in the making, and I am happy to be here today.
    I would like to welcome our witnesses from Montana, Dan Keil and 
Bruce Sunchild, Sr., who have been two of the most actively involved 
members of the coalition that has built this proposal. Dan Keil is 
speaking on behalf of the North Central Montana Regional Water 
Authority, and Bruce Sunchild is speaking on behalf of the Chippewa 
Cree Tribe of the Rocky Boy's Reservation. Additionally, I would like 
to thank BOR Commissioner John Keyes for being here today and for his 
attentiveness to this and other Montana issues.
    The Rocky Boy's/North Central Water Project will bring a safe, 
reliable water supply to about 19,000 people spread across 10,700 
square miles in 8 Montana counties. That's a lot of space, without much 
water. Groundwater in north central Montana is very sparse, and many of 
these communities are heavily burdened with poor water quality, 
unreliable sources, and changing federal drinking water regulations. 
Several of these communities are currently are under threat of 
administrative action by the Montana DEQ for non-compliance to Safe 
Drinking Water Standards. Without upgrades, these communities will be 
without water.
    This has been a long and complicated process, but through it all, 
the cooperation of the members has been very impressive. The Chippewa-
Cree tribe, the State of Montana, and the United States negotiated 
agreed a water compact in the 106th Congress and we passed Public Law 
106-163 which identified a 10,000 acre-foot water right at Lake Elwell, 
or Tiber Dam, and provided $15 million for upgrades to the tribal 
municipal water system. I was glad to be a part of that process and 
sponsored the legislation. Now it is time to connect those two pieces.
    At the same time, the Rocky Boy's water compact was being 
negotiated, a group of communities in the region were determining how 
to best meet their community water needs at a reasonable cost, and the 
North Central Regional Water Authority was created. The Tribe and the 
North Central Authority worked together very well and have produced an 
effective solution that will help strengthen the region's water supply 
picture.
    The State of Montana has played a large role in this process as 
well and has been very supportive of this process. The Montana 
Legislature created a mechanism to fund the State share of regional 
rural water projects in 1999. The Treasure State Regional Water Fund 
has now grown to over $8 million and will continue to receive $4 
million a year until 2016. Earnings for this fund will be used as state 
matching funds for federal dollars.
    The State, local, and federal involvement in this project has been 
extensive and has produced a very good result. I support this project 
and am glad to be part of it. I look forward to hearing the testimony 
of the witnesses.

    Senator Dorgan. Commissioner Keys, thank you so much for 
being with us, and we will include your statement in its 
entirety in the record. Why don't you proceed to summarize.
    Mr. Keys. Mr. Chairman, I am testifying on five bills 
today; is there any certain order that you would prefer me to 
take them, chronologically or whichever?
    Senator Dorgan. Well, does any part of your testimony have 
greater merit than other parts?
    Mr. Keys. No, sir, they're all very important.
    [Laughter.]
    Senator Dorgan. Well then, why don't you proceed at your 
will.

    STATEMENT OF JOHN W. KEYS III, COMMISSIONER, BUREAU OF 
            RECLAMATION, DEPARTMENT OF THE INTERIOR

    Mr. Keys. Yes, sir. Mr. Chairman, I would ask that all of 
the statements be included in the record.
    The first one is S. 934, which would require the Secretary 
of the Interior to construct the Rocky Boy North Central 
Montana Regional Water System in north central Montana. The 
administration supports the goal of assuring a safe and 
reliable water supply for the Rocky Boy Reservation and other 
communities in north central Montana. We recognize that this 
area is historically water short, and with water quality and 
water infrastructure concerns, and we understand that some of 
the communities are facing safe drinking water standard 
violations.
    However, we cannot support S. 934 as introduced. We have 
several concerns that I will try to outline for you. First, 
section 2(a)(2) states that the United States has a trust 
responsibility to insure that adequate and safe water supplies 
are available to meet the needs of the reservation. Such 
provision would cause large problems with respect to Federal 
liability. It would make the United States responsible for 
providing domestic water systems on the reservation, something 
that has not been envisioned before now.
    Second, the proposed bill would provide an inequitable cost 
share requirement for parties to the construction. It would 
call for perpetual Federal financial and management obligations 
for both construction and operation and maintenance of the 
system, and it would be in conflict with the 1944 Flood Control 
Act in allowing the use of project use power from the Pick 
Sloan Missouri basin program for non-irrigation purposes.
    Third, S. 934 contains provisions that would replicate 
activities already required and underway under the Settlement 
Act, Public Law 106-163. Section 203 of that Settlement Act 
authorized a regional feasibility study for north central 
Montana. That study is underway to evaluate water and related 
resources in north central Montana. It's a comprehensive study 
that is looking at water supply and needs by the agricultural, 
municipal, rural, and industrial water users. The appraisal 
level scoping document is scheduled for completion in October 
of this year with the final planning report due in 2004.
    Section 202 of the Settlement Act authorized a municipal, 
rural and industrial feasibility study to evaluate alternatives 
for water supply for the Rocky Boy reservation. The tribe 
released a draft report of this study in July 2001. We are 
currently working with the tribe to complete that study.
    And fourth, several other provisions of S. 934 are also 
inconsistent with the Settlement Act. They involve the water 
source for the tribal and non-tribal communities, financial 
arrangements for the non-tribal obligations, and other 
provisions of Reclamation law.
    And finally, we're concerned about the strain on 
Reclamation's budget that S. 934 would cause. It would 
authorize another $180 million to be spent on the project. Many 
times over the last 15 years Reclamation has been put in the 
awkward position of opposing projects that try to solve 
untenable situations, yet millions of Americans still live 
without safe drinking water. Congress has authorized us to 
develop nearly a dozen single purpose, MR&I projects from rural 
communities throughout the Western United States.
    These projects will cost more than $2 billion to build, and 
most were developed from feasibility studies with little or no 
input from Reclamation. In other words, we just pass the money 
through from Reclamation to the developers. While each is 
different in its terms, many share common problem areas, 
inequitable Federal cost share provisions and responsibility, 
and the responsibility for operation and maintenance.
    We need to work together, the administration, Congress, the 
States, the tribes, and the water users, to identify these 
elements and try to put together a program that would take care 
of those situations.
    Now certainly we appreciate the help from Mr. Burns and Mr. 
Baucus in trying to address these. The administration believes 
that S. 934 is premature at this time. I would certainly like 
to reiterate Interior's support for implementing the Rocky Boy 
Water Rights Settlement Act, and our support for finding a way 
to meet domestic water needs in north central Montana.
    Mr. Chairman, S. 1557 would amend Public Law 106-576 by 
authorizing 15 additional projects in the Lower Rio Grande 
Valley of west Texas. It would also increase the authorization 
for report preparation to $8 million, institute a 50 percent 
cap on Federal report preparation costs and increase the 
authorization for project funding to $47 million.
    The Department appreciates and supports efforts by the 
irrigation districts in the Lower Rio Grande Basin to improve 
and encourage water efficiency and to responsibly manage water 
supplies in the border region during the severe drought that 
exists in that area now. Under Public Law 106-576 Reclamation 
has worked successfully and cooperatively with local entities 
in the basin, the Texas Water Development Board and the Texas 
Agricultural Extension Service to develop the necessary 
criterion to administer the law and determine project 
feasibilities and eligibilities for Federal funding. We 
continue to work with the districts to complete the studies for 
the first four authorized projects. So far, so good. We are 
also working cooperatively on field tests to try to control 
several noxious plants in the canals of the area, hydrilla and 
water hyacinth.
    Mr. Chairman, our concern with S. 1557 is that it 
authorized 15 new projects without first having feasibility 
studies completed for them and their not have been having been 
reviewed by Reclamation for adequacy. We are very concerned 
about the effects of the water shortage in Texas and certainly 
in the Rio Grande Valley, and we would commit to maintain the 
work that we're doing with them now to complete those studies 
that are underway, to complete the construction of those four 
authorized projects, and then do some studies on those others 
to be authorized at some future time.
    Mr. Chairman, S. 1882, an amendment to the Small 
Reclamation Projects Act of 1956, would authorize $1.3 billion 
for three new programs, revise and expand the grant and loan 
program of Reclamation, create a Small Reclamation Water 
Resources Management Partnership Program, and establish a 10-
year loan guarantee program.
    Our Department recognizes the reality of aging Federal and 
non-Federal water infrastructures that will need rehabilitation 
during the next several decades. We understand the many other 
future needs for ecosystem restoration, new water supplies, and 
improvements for the quality of our rivers and streams.
    The Department supports these efforts and has programs that 
work in many of these areas. We are also most interested in 
workable effective ways to protect our water supplies, water 
quality, and aquatic habitats. However, the programs that would 
be authorized by S. 1882 would strain Reclamation's financial 
and administrative resources. If enacted, it would even make it 
difficult to meet many of our existing obligations. Therefore, 
the Department cannot support S. 1882.
    We have several specifics. It would be a very costly 
program, requiring new and significant funding resources that 
would compete with other departmental funding priorities. It 
would greatly expand Reclamation's authority and jurisdiction 
to include projects not only in the 17 Western States and 
Hawaii, but would also include those in Puerto Rico, Guam, 
American Samoa, the Northern Mariana Islands, the Virgin 
Islands, and islands of the Pacific Territory. This large 
expansion would tax Reclamation's budget and work force much 
beyond its current limits.
    Establishment of a loan guarantee program in Reclamation 
also has many concerns. It would take quite a while to get up 
and running and it would require additional expertise and 
staffing. New principles and standards would have to be 
developed for the program and compliance with the Federal 
Financial Management Act of 1996 would have to be insured. It 
would also put us in the role of a commercial loan officer, a 
role that our inspector general has been critical of in the 
past.
    Mr. Chairman, there is a great deal of public interest in 
the small loan program. We field inquiries on that program 
regularly. The Department supports effort to provide technical 
assistance to the water users. However, the combined financial 
and administrative burdens imposed by S. 1882 are such that we 
cannot support this approach. We would certainly welcome the 
opportunity to work with you and the committee to find an 
alternate way to do that, or maybe dust off one of the old 
programs that we already have authority to use in doing that.
    Mr. Chairman, S. 2556, the Fremont-Madison Conveyance Act, 
would transfer title to the Cross Cut Diversion Dam and Canal, 
the Teton Exchange Wells and the Idaho Department of Water 
Resources permit number 22-7022, for those wells to the 
Fremont-Madison Irrigation District in eastern Idaho.
    The Cross Cut Diversion Dam and Canal are paid-out 
facilities with their irrigation assessments completed in 1979. 
The legislation provides for the payment for the Teton Exchange 
Wells and permit, currently valued at $277,961.
    The Bureau of Reclamation has worked closely with the 
Fremont-Madison Irrigation District over the past few years to 
settle the issues involved with the title transfer for the 
facilities and the permit. We are very close to agreement on 
this bill. While there are still a couple of issues to solve, 
the Department could support S. 2556 with a couple of technical 
modifications.
    First, section 3(a) of S. 2556 requires the district to pay 
the administrative costs of the title transfer and related 
activities, including the cost of any NEPA review. It also 
limits the district's contributions toward these administrative 
costs to $40,000. In September 2001, Reclamation and the 
district signed a memorandum of agreement which called for each 
party to pay 50 percent of costs associated with applicable 
procedural requirements. The MOA also calls for the district to 
pay for applicable surveys, title searches, facility 
inspections and development of a quit claim deed and other 
legal documents. Section 3(a) is not clear on which of these 
activities are subject to the $40,000 limitation. We believe 
the MOU signed by both of us should be honored and that the 
limitation be eliminated from the bill.
    Section 2(a) of S. 2556 requires that the title transfer be 
completed no later than the termination date of the MOA, in 
other words, September 13, 2003. Section 2(d)(1) states that 
the transfer should be done as soon as practicable. We would 
appreciate clarification, preferably using the language ``as 
soon as practicably.''
    Mr. Chairman, we have worked closely with the district in 
trying to get this title transfer done. We think it's a good 
title transfer and certainly are willing to work with you on 
the few details so that we can get on and get this done. 
Certainly Mr. Raybould and Dale Swenson, their manager there, 
have been great people to work with and we certainly appreciate 
the support of Mr. Craig and Mr. Crapo in getting this one 
done.
    Mr. Chairman, S. 2696 would clear title to certain real 
property associated with the Middle Rio Grande project in New 
Mexico. The Department is not adverse to transferring the San 
Gabriel and Tingley Beach property parcels to another entity. 
However, there is a current ongoing lawsuit before the U.S. 
Court for the District of New Mexico over the disputed 
ownership of these parcels.
    We believe the most prudent course of action is to allow 
the Court to give its decision on the disputed lands before 
instituting a legislative remedy. Therefore, the Department 
cannot support S. 2696 at this time.
    With respect to the city of Albuquerque's request to make 
improvements on the property, Reclamation has issued a license 
to the city that allows the use of those lands as proposed in 
its improvement plans.
    Mr. Chairman, while there is disagreement with the Middle 
Rio Grande Conservancy District on the title to these lands, 
the district is a good and valuable partner on this project. 
They have retired their debts to the United States. While we 
believe that it is best to wait on the Court's decision to 
settle this matter, we are open to working with all of the 
parties to find an acceptable solution.
    That concludes the formal statements and I would certainly 
stand for any questions you night have.
    [The prepared statements of Mr. Keys follow:]

 Prepared Statements of John W. Keys III, Commissioner of Reclamation, 
                       Department of the Interior

                                 S. 934
    My name is John Keys. I am Commissioner of the U.S. Bureau of 
Reclamation. I appreciate the opportunity to provide the 
Administration's views on S. 934, legislation to require the Secretary 
of the Interior to construct the Rocky Boy's/North Central Montana 
Regional Water System, in the State of Montana.
    The Administration supports the goal of assuring a safe and 
reliable water supply for both the reservation and the non-reservation 
communities in north-central Montana. We recognize that north-central 
Montana is an historically water-short basin, with water quality and 
water infrastructure concerns. We understand some of these communities 
may be facing Safe Drinking Water standard violations. However, the 
Administration cannot support S. 934, as introduced, because it imposes 
new responsibilities to provide domestic water both to the Rocky Boy's 
Reservation, inconsistent with the recent settlement, and to non-Indian 
communities under provisions that are inconsistent with Administration 
policy.
    In considering S. 934, it is necessary to revisit briefly Public 
Law 106-163, the Chippewa Cree Tribe of the Rocky Boy's Reservation 
Indian Reserved Water Rights Settlement and Water Supply Enhancement 
Act (Settlement Act). The purposes of the Settlement Act are to achieve 
a ``fair, equitable and final settlement of all claims to water rights 
in the State of Montana for the Chippewa Cree Tribe.'' The Department 
has been strong in its support of the Settlement Act and its 
implementation; Reclamation is authorized to fund $29 million and the 
Bureau of Indian Affairs is authorized to fund $21 million for a total 
settlement of $50 million. These monies are for multiple economic and 
water development activities on the reservation, and include $15 
million for municipal, rural and industrial water needs of the Tribe.
    We have numerous concerns with S. 934: first, the ``Finding'' of 
section 2(a)(2)--which states that the United States has a trust 
responsibility to ensure that adequate and safe water supplies are 
available to meet the needs of the Reservation. As written, S. 934 
indicates that Congress intends to make the United States responsible 
for providing domestic water systems on the Reservation, including 
potential liability for money damages if such duty is not met. This 
commitment could have serious adverse legal consequences with respect 
to Federal liability.
    The Administration also has concerns about (1) the strain on 
Reclamation's current budget; (2) the inequitable cost share 
requirement; (3) the potentially perpetual Federal financial and 
management obligation for both construction and for operating and 
maintaining the system; and (4) the proposed use of project use power 
from the Pick Sloan Missouri Basin Program (PSMBP) for non-irrigation 
purposes. I will submit separately a more detailed analysis of these 
and related technical issues.
    Several provisions in S. 934 are inconsistent with the Settlement 
Act and Reclamation policy. For example, the Settlement Act recognized 
a Tribal right to a 10,000 acre-feet per year permanent allocation from 
Reclamation's Tiber Reservoir (Lake Elwell), without cost to the Tribe. 
Thus, under the Settlement Act, costs incurred by the Federal 
Government for the design and construction of the reservoir are not 
passed on to the Tribe, nor is an annual operations and maintenance 
charge assessed, which is otherwise standard procedure under 
Reclamation Law (via water service and repayment contracts). S. 934 is 
not clear what the water source would be for the pipeline. Any 
authorization should provide that the tribal supply will be the 10,000 
acre-feet Tiber allocation already held by the Tribe. If future 
supplies for the non-tribal communities are to come from Tiber water, 
the beneficiaries should pay their proportionate capital costs for the 
reservoir and the pipeline, as well as operation and maintenance costs. 
Across the 17 western states, current municipal & industrial (M&I) 
beneficiaries at Reclamation reservoirs pay these costs, and with 
interest.
    Two other examples of how S. 934 is inconsistent with the 
Settlement Act pertain to the extent of federal financial 
responsibility. Section 201(d) of the Settlement Act states explicitly 
that ``The United States shall have no responsibility or obligation to 
provide any facility for the transport of water allocated by this 
section to the Rocky Boy's Reservation or to any other location. Except 
for the contribution set forth in section 105(a)(3), the cost of 
developing and delivering the water allocated by this title or any 
other supplemental water to the Rocky Boy's Reservation shall not be 
borne by the United States'' (emphasis added). In contrast, S. 934 
places the total cost of the tribal portion of the system on the United 
States, including the upsizing necessary to serve the North Central 
Montana Water Authority.
    With regard to the Rocky Boy's Reservation needs, the Settlement 
Act authorizes $15 million for the planning, design, construction, 
operation, maintenance, and replacement of a future water supply system 
for the Reservation. Sec. 105(a)(3) of the Act states that these funds 
are ``for the total federal contribution'' (emphasis added) to such a 
system. In contrast, S. 934 would authorize the Secretary of the 
Interior to assist the Chippewa Cree Tribe on the Rocky Boy's Indian 
Reservation to plan, design, construct, operate, maintain, and replace 
the Rocky Boy's Rural Water System. In addition, it would authorize 
federal assistance to the North Central Montana Regional Water 
Authority for the planning, design, and construction of the non-core 
rural water system off the reservation. The bill would authorize 
appropriations of at least $120 million for the core system on the 
Rocky Boy's Indian Reservation (not including the Federal obligation 
for operations, maintenance and replacement (OM&R)). Further, S. 934 
would authorize at least $60 million for the non-core system that 
provides water deliveries to areas that are not on the reservation.
    Finally, S. 934 contains provisions that replicate activities 
already required--and underway--under the Settlement Act. Section 203 
of the Settlement Act authorizes a regional feasibility study for North 
Central Montana. Since the rural water project proposed by S. 934 is a 
smaller portion of the region encompassed by the study, we believe that 
consideration of S. 934 is premature until the regional feasibility 
study is final. Further, other Indian water rights settlements in the 
basin are being negotiated. Until those settlements are concluded, it 
is not clear what the relative demands and needs of the basin will be. 
The regional feasibility study to be conducted under section 203 of the 
Settlement Act will produce a comprehensive analysis of the region's 
water needs, and will provide Congress with an informed context as it 
considers legislation on further rural water development in north-
central Montana.
    Also, Section 202 of the Settlement Act authorized a municipal, 
rural, and industrial study requiring that multiple alternatives be 
brought forward at the feasibility level, so all parties to the 
settlement could make informed decisions. To implement section 202 of 
the Act, the Tribe released a draft feasibility study in July 2001, and 
Reclamation is working with the Tribe to complete the study. 
Reclamation emphasizes that the intent of Section 202--a thorough 
evaluation of the feasibility of multiple alternatives--must first be 
met, so decision makers can make informed decisions.
    Previous efforts to address the water needs of rural communities 
have taken a piecemeal approach, without a programmatic basis. This has 
resulted in a number of common problems. The authorized Federal cost-
shares have been inequitable, and the authorized Federal obligations 
for facility operations and maintenance are unsustainable. 
Additionally, expectations on the part of communities with authorized 
projects become frustrated because of delays due to inadequate 
available resources. I suggest a more comprehensive approach. We need 
to work together--the Administration, the Congress, the States, and the 
stakeholders--to provide safe drinking water for rural America. We need 
to identify the appropriate Federal and non-Federal roles in providing 
this water, to evaluate the appropriate role to be played by the 
numerous Federal and non-Federal agencies involved with developing 
municipal, residential, and industrial water in rural and small-town 
America. This is a priority for me and this Administration. I look 
forward to working with the Committee and Subcommittee to formulate a 
programmatic approach to rural water issues.
    In conclusion, Mr. Chairman, the Administration believes that S. 
934 is premature. However, I would like to reiterate the Department's 
support for implementing the Rocky Boy's Water Rights Settlement Act as 
well as our support for finding a way to meet the domestic water supply 
needs of north-central Montana. As such, we would like to work with 
Senator Burns and the rest of the Montana delegation, the Committee, 
the Tribe, and the project sponsors to work through these difficult 
issues in a manner that addresses the needs of Montana and the 
interests and concerns of the Department.

                           S. 1577/ H.R. 2990

    My name is John Keys and I am the Commissioner of the Bureau of 
Reclamation. I am pleased to present the Department's views on S. 1577 
and H. R. 2990, which amend P.L. 106-576, the Lower Rio Grande Valley 
Water Resources Conservation and Improvement Act of 2000 and to discuss 
water issues in the Lower Rio Grande Valley. Given that both bills are 
nearly identical, my comments will apply to both measures.
    S. 1577 and H.R. 2990 aim to provide areas in Texas that are facing 
a drought, with some important water saving measures. The Department 
lauds efforts to improve and encourage water efficiency, and to 
responsibly manage water supplies in the border region. The 
Administration, the Department of the Interior and the Bureau of 
Reclamation (Reclamation) share the concern of the Committee, the State 
of Texas, and the water users over the severe water shortages that 
exist in this area. The Administration supports the goals to amplify 
and make more efficient use of the current water supply. The 
Administration is committed to working with the Committee to 
effectively address these water supply concerns.
    These bills would amend P.L. 106-576 by authorizing 15 additional 
projects in West Texas and in the Lower Rio Grande Valley of Texas. S. 
1577 and H.R. 2990 would increase the authorization for report 
preparation to $8,000,000, institute a 50% cap on federal report 
preparation costs, and increase the authorization for project funding 
to $47,000,000.
    The Department of the Interior testified in general support (with 
some suggested revisions) of the legislation that became P.L. 106-576. 
These measures appear to maintain the intent of the existing law while 
authorizing additional projects and increasing the funding ceilings. 
However, given the numerous other demands on Reclamation's budget and 
the number of already authorized but unfunded projects, we have 
concerns about adding additional projects to Reclamation's workload at 
this time. We also have concerns over the lack of Administration review 
in the process for projects in this bill. The Administration does not 
support authorizing projects that have not undergone Administration 
review. It is important to note that appropriations will be needed in 
order to implement the original Act and any new authorizations.
Reclamation Background in the Lower Rio Grande
    The Department's involvement with the Lower Rio Grande irrigation 
districts dates back almost 50 years when Reclamation began cooperative 
efforts to modernize facilities and improve water use efficiency. 
Beginning in 1954, investigations identified the need for 
rehabilitation of existing distribution systems and construction of 
main drain outlets for the La Feria and Mercedes Districts. Public Laws 
85-370 and 86-357 authorized the rehabilitation projects for La Feria 
and Mercedes districts respectively. Rehabilitation of the diversion, 
distribution, and drainage systems were accomplished through contracts 
among the local entities and Reclamation. Both the La Feria and 
Mercedes districts have paid out their repayment obligation associated 
with their projects and Reclamation is currently in the process of 
returning title to the La Feria lands conveyed to the United States as 
part of their contractual obligation. In addition, Reclamation entered 
into contracts with numerous irrigation districts in Harlingen, Hidalgo 
and Cameron counties pursuant to the Small Reclamation Projects Act of 
1956. All contracts are now paid out, with Donna Irrigation District 
being the most recent to fulfill its repayment obligation in 2001.
    Through the years, Reclamation has also prepared technical reports 
covering water conservation and basin studies to identify specific 
problems and needs of the area. For example, in September of 2000, 
Reclamation sponsored a Water Conservation Field Services workshop in 
Weslaco, Texas to present current information and technology updates to 
local irrigation districts regarding water measurements, management, 
and conservation.

P.L. 106-576
    In December 2000, the Lower Rio Grande Valley Water Resources 
Conservation and Improvement Act was signed into law and became P.L. 
106-576.
    This legislation was an effort to provide some important water 
saving measures to an area of Texas that had suffered from drought. 
Briefly, the law directed the Secretary, acting through the 
Commissioner of Reclamation, to undertake a program, in cooperation 
with the State of Texas, water users and other non-Federal entities, to 
investigate and identify conservation and efficiency improvement 
opportunities. This was to include review of studies or planning 
reports prepared outside of Reclamation and the evaluation of 
alternatives such as lining irrigation canals and increasing the use of 
pipelines and other water delivery facilities.
    Within six months of enactment, the Secretary was to develop and 
publish a set of criteria to determine which projects would qualify and 
have the highest priority for financing. P.L. 106-576 provided certain 
minimum criteria and required the Secretary to make a determination of 
whether the project meets the criteria within a year of submittal of a 
request. The law also outlined the report, plan and cost-sharing 
requirements a project sponsor would need to fulfill to secure federal 
funding. The law authorized four projects and $10,000,000 for their 
construction if they later met these criteria and project requirements. 
The federal cost share was capped at 50% of any construction, with up 
to 40% to be contributed by the State. The remainder of the non-federal 
share was authorized to include in-kind contributions of goods and 
services, including funds previously spent on feasibility and 
engineering studies.
    Since enactment of the bill, Reclamation has been working 
successfully and cooperatively with local entities in the Lower Rio 
Grande, the Texas Water Development Board, and the Texas Agricultural 
Extension Service of Texas A&M University on its implementation. As 
noted, a requirement of P.L. 106-576 was issuance of criteria by which 
Reclamation would administer the law and determine project eligibility 
for federal funding. Reclamation prepared and shared criteria with 
state, local and other federal entities. The criteria were finalized in 
late June 2001, within the six month time frame provided in P.L. 106-
576.
    Reclamation also has worked closely with those districts involved 
in the four authorized projects and with the Texas Water Development 
Board to address funding necessary to begin planning, designing, and 
reviewing the project plans and reports. Funding for Reclamation to 
begin preparation of a project plan and report has been advanced from 
one district. Three other districts are funding similar work by 
consultants. To date, three projects have been submitted to 
Reclamation. The authorized projects in the original bill have not been 
appropriated Federal funds.
    Reclamation will continue its efforts to implement the Lower Rio 
Grande Water Resources Conservation and Improvement Act of 2000 to help 
make the most efficient use possible of the available supply. 
Reclamation is also working with several entities in the Valley to 
field test various methods of controlling water hyacinth and hydrilla. 
These noxious plant species are spreading rapidly and are increasingly 
clogging irrigation district canals and intakes to pumping plants--all 
of which greatly restrict the flow of water both within the irrigation 
systems and in the Rio Grande as well.
    The Department's activities in the Lower Rio Grande Valley are 
important components of government service in the area, but they are 
only one part. We applaud the many efforts taken by universities, state 
and local governments, and other federal agencies. We pledge to 
continue the Departments coordination and cooperation as we all work 
together to conserve the water resources that are in such short supply.

S. 1577/H.R. 2990
    Project Authorization: Under P.L. 106-576, projects would include 
on-farm activities to enhance water conservation, such as water 
application metering, concrete lining of canals and other irrigation 
system management improvements. The proposed legislation would continue 
these activities and also enable the Secretary to use cooperative 
agreements to work with the State of Texas, non-Federal entities, and 
institutions of higher education, to develop educational programs and 
establish on-farm training programs for state-of-the-art water 
application and conservation techniques. We are concerned that this 
bill, like the earlier bill, authorizes projects without first 
undergoing the Administration review required by Executive Order 12322.
    Project Eligibility Requirements: In 2000, the Commissioner of 
Reclamation testified on the legislation that became P.L. 106-576, 
stating that funding and eligibility decisions should be made on the 
basis of the relative costs associated with water conservation 
opportunities. The amendments presented in S. 1577 and H.R. 2990 adopt 
the criteria established by Reclamation under the 2000 legislation. The 
Department supports this approach, as it provides more certainty to 
applicants by ratifying Reclamation's standards in law.
    One aspect of improving efficiency is ensuring that the 
improvements made provide the highest return. Reclamation's guidelines 
will assist in that. However, given that the authorization level is 
proposed to increase to $47 million, it also may be appropriate to 
analyze the projects (or sets of projects) in the context of the 
established Principles and Guidelines. A simplified approach to the 
analysis could possibly be used, such as a recent model for this area 
prepared by Texas A&M University as a potential tool for evaluating 
projects in the Lower Rio Grande Valley.
    Funding and Cost Sharing: The cost sharing provisions adopted in 
P.L. 106-576 establish a 50 percent federal maximum for construction 
costs. These bills would amend Section 4 (b) of P.L. 106-576 to 
stipulate that the 50 percent federal maximum be applied to total 
project costs (e.g. studies, designs, reviews, approvals, construction) 
rather than just construction. This change would simplify the 
application of cost sharing provisions between the federal and non-
federal contributions for completing a project. The $47 million amount 
for construction is subject to further review when project reports are 
developed.

Conclusion
    Mr. Chairman, we are very concerned about the effects of the water 
shortage in the Lower Rio Grande Valley and we recognize the importance 
of improving the efficiency of water use and delivery in this part of 
the country, especially in light of the current drought conditions. 
Reclamation would be happy to work with Senator Hutchison and the 
Committee to continue to address the water supply problems.

                                S. 1882

    My name is John Keys and I am the Commissioner of the Bureau of 
Reclamation (Reclamation). I am pleased to appear before this 
Subcommittee to provide the Department's views on S. 1882.
    S. 1882 would amend the Small Reclamation Projects Act (SRPA) to 
authorize $1.3 billion for three new programs: a revised and expanded 
grant and loan program within the Bureau of Reclamation; a Small 
Reclamation Water Resources Management Partnership Program; and a 10-
year loan guarantee program.
    The Department recognizes the realities of an aging federal and 
nonfederal water infrastructure that will need rehabilitation during 
the next several decades, and understands the many other future needs 
involving ecosystem restoration efforts, new water supplies for 
increasing demands, and improvements in the quality of our rivers and 
streams. The Department supports ongoing environmental restoration 
programs, as well as water reclamation and reuse and has programs that 
contribute to these areas. The Department is also interested in 
workable, effective ways to protect water quality and quantity, 
including aquatic habitats. However, the programs authorized by this 
bill would strain Reclamation's financial and administrative resources, 
and if enacted would make it even more difficult to meet our many other 
obligations. Therefore, the Department cannot support S. 1882.
    I note that the provisions in S. 1882 are nearly identical to those 
approved by the House Resources Committee on November 11, 2001. As you 
are aware, last July Secretary Norton testified before the House 
Subcommittee on Water and Power on H. R. 1985, Small Reclamation Water 
Resources Project Act of 2001. The Secretary expressed a number of 
concerns with the SRPA provisions of H.R. 1985: Those concerns remain 
true for S. 1882.
    First, it would be a very costly program, requiring new and 
significant funding resources to implement. It also would compete with 
other Departmental priorities for funding.
    Second, the bill would greatly expand Reclamation's authority and 
jurisdiction to include not only projects in the 17 Western states and 
Hawaii, but also those located in the Commonwealth of Puerto Rico, 
Guam, American Samoa, the Commonwealth of the Northern Mariana Islands, 
the Virgin Islands, and the Territory of the Pacific Islands. Given the 
number of other demands on Reclamation's budget and the number of 
already authorized but unfunded projects, we have concerns about adding 
any additional projects to Reclamation's current workload.
    Finally, establishment of a ``Loan Guarantee'' Program would 
require much lead time, and also require additional staffing. The 
program would need to be developed in a manner that meets the 
principles and standards set forth in OMB Circular No. A-129, 
``Policies for Federal Credit Programs and Non-Tax Receivables,'' and 
the requirements of the Federal Financial Management Improvement Act of 
1996. It also would put Reclamation in the role of a commercial loan 
officer for developers of projects, a role Interior's Inspector General 
criticized in a 1991 audit report.
    Although the SRPA Program is currently inactive and has not 
accepted new loans since 1993, there continues to be public interest in 
the program, with staff occasionally receiving inquiries about possible 
loan/grant funding for non-Federal small projects. The Department 
supports efforts to provide technical assistance to non-Federal water 
user entities in constructing and rehabilitating their water resource 
projects and in carrying out restoration efforts. However, the combined 
financial and administrative burdens imposed by this bill are such that 
we cannot support this approach. Therefore, the Department cannot 
support S. 1882. The Department welcomes the opportunity to work with 
Subcommittee members to find workable solutions to address 
Reclamation's aging water infrastructure and restoration needs

                                S. 2556

    Mr. Chairman, my name is John Keys. I am Commissioner of the U.S. 
Bureau of Reclamation. I am pleased to provide the Administration's 
views on S. 2556, the Fremont-Madison Conveyance Act, which directs the 
Secretary of the Interior to transfer title of certain Federal owned 
facilities, lands and permits to the Fremont-Madison Irrigation 
District (District).
    The facilities under consideration for transfer in S. 2556--the 
Cross Cut Diversion Dam and Canal, the Teton Exchange Wells and the 
Idaho Department of Water Resources permit number 22-7022--are 
associated with the Upper Snake River Division, Minidoka Project and 
the Lower Teton Division, Teton Basin Project, respectively, and are 
located near Rexburg in eastern Idaho. The facilities under 
consideration for transfer are used exclusively for irrigation purposes 
and have always been operated and maintained by the District. While the 
Cross Cut Diversion Dam and Canal are paid-out by the District, the 
legislation provides for a payment for the Teton Exchange Wells, which 
are currently valued at $277,961, based upon the outstanding balance to 
be repaid by the District.
    Mr. Chairman, over the last few years, we have been working very 
closely with the District and numerous other local organizations 
including the Henry's Fork Foundation, a local conservation and 
sportsmen's organization, to work through the issues on the title 
transfer for the features, lands and water rights associated with this 
project. Over the last year, we have made great progress in narrowing 
the scope of the transfer to meet the District's needs, protect the 
interests of the other stakeholders, and ensure that the transfer does 
not negatively impact downstream contractors of the integrated Snake 
River system. While I believe that we are very close to agreement on 
this legislation, S. 2556, as drafted, creates some problems and 
concerns, which I will address in my statement. However, with the 
technical modifications outlined below, the Department could support S. 
2556.

Background
    Individuals, organizations, Federal, States and local agencies 
interested in the Henry's Fork of the Snake River have a very 
impressive history of collaboration and cooperation through the Henry's 
Fork Watershed Council (Council)--a grassroots community forum whose 
goal is to encourage management of the Henry's Fork Basin in a 
socially, economic and environmentally sustainable manner. When the 
District first raised the idea of title transfer, the Council dedicated 
its March, 1999, meeting to this issue. This included presentations by 
the District and Reclamation and fostered open discussions with any and 
all groups or individuals who had comments or concerns.
    Subsequently, the District and the Henry's Fork Foundation, along 
with the Land and Water Fund of the Rockies engaged in a series of 
negotiations to develop a mutually acceptable proposal. While that 
process did not result in a concrete proposal, it did lead to some 
consensus on the facilities to be transferred that are included in this 
legislation. It also led to the removal of the Grassy Lake and Island 
Park dams from the transfer proposal about which many local 
organizations had serious concerns.
    Accordingly, in September, 2001, Reclamation and the District 
signed a memorandum of agreement (Contract No. 1425-01-10-3310) (MOA) 
which expires on September 13, 2003, and is referenced in S. 2556. This 
agreement lists the facilities to be transferred, delineates the 
respective responsibilities to complete activities necessary for the 
title transfer such as arrangements for the sharing of costs, valuation 
of the facilities to be transferred, and responsibilities associated 
with compliance with Federal and State laws.
    We have, however, identified some concerns and technical issues 
which I would like to raise for the Committee's consideration:

Cost Share Requirements
    First, Section 3(a) of S. 2556 requires the District to pay the 
administrative costs of the conveyance and related activities, 
including the costs of any review required under NEPA, but limits their 
contribution to no more than $40,000. This language is both unclear as 
to what is or is not included as ``costs,'' nor is it in accordance 
with the MOA that FMID should pay the 50% of costs associated with 
applicable procedural requirements of the NEPA, ESA, and other 
applicable state and federal laws required.
    We agree that it is appropriate to share the costs of compliance 
with Federal laws, as was agreed upon in the MOA. We also believe that 
the recipients of title transfer should cover those costs that are 
associated with the real estate transaction resulting from the title 
transfer. In this vein, the MOA states that the District would pay for 
applicable activities such as surveys, title searches, facility 
inspections, and development of a quit claim deed or other legal 
documents necessary for completing the transfer. Unfortunately, S. 
2556, as drafted, is unclear on this point.
    To address these ambiguities, we suggest that S. 2556 reference the 
MOA's treatment of costs or reiterate the manner in which the 
distribution of costs were addressed in the MOA. Given the amount of 
work that went into developing the MOA, its applicability under S. 2556 
for implementation of the transfer, and the fact that it has been 
agreed upon and signed by representatives of both Reclamation and the 
District, referencing the MOA on these issues would provide an 
equitable, clear and consistent resolution to our concern.

Conveyance Deadline and Report
    Section 2(a) of S. 2556 requires that the title transfer be 
completed no later than the termination date of the MOA (September 13, 
2003). However, Section 2 states that the transfer be completed ``as 
soon as practicable after the date of enactment and in accordance with 
all applicable law.'' These provisions appear inconsistent as Section 
2(a) designates a required date certain for completion, while Section 
2(d) (1) states that it be completed ``as soon as practicable,''
    Further, Section 2(d) (2) requires that the Secretary submit a 
report to Congress within one year of the date of enactment if the 
transfer has not been completed in that time frame. This provision 
seems somewhat arbitrary and could potentially delay the transfer from 
the September 13, target date while the report is being prepared.
    To address our concerns with inconsistent deadlines and reporting 
requirements, I suggest that the legislation be modified to require 
that the transfer be completed ``as soon as practicable after the date 
of enactment'' and the reporting requirement in S. 2556 be modified to 
require a report to Congress be completed only if the title has not 
been transferred by September 13, 2003 the expiration date of MOA 
referenced in the legislation. In this manner, the requirements are 
made clear and consistent, and no report to Congress would be necessary 
if the facilities are transferred by the MOA's expiration date.

Conclusion
    In conclusion, Mr. Chairman, I believe we have worked closely with 
the District and a great deal of progress has been made. I would like 
to take this opportunity to compliment District Board Chairman Jeff 
Raybould and their Executive Director, Dale Swenson, for their 
diligence and commitment in working with us and the other interested 
entities of eastern Idaho on the issues surrounding this transfer. I 
would also like to thank Senator Craig and Senator Crapo and their 
staffs for their cooperation. With the technical modifications 
mentioned above, I believe the Department could support passage of this 
legislation.

                                S. 2696

    My name is John Keys and I am the Commissioner of the Bureau of 
Reclamation (Reclamation). I am pleased to be here today to present the 
views of the Department regarding S. 2696, which would clear title to 
real property in New Mexico associated with the Middle Rio Grande 
Project and for other purposes.
    The Department has some concerns with S. 2696, primarily that the 
dispute over ownership of the San Gabriel and Tingley Beach parcels is 
currently embodied in a pending lawsuit before the United States 
District Court for the District of New Mexico. Aside from the lawsuit, 
the Department also has concerns about the method in which this 
legislation attempts to transfer the property. The Department is not 
adverse to transferring ownership to another entity, but all parties 
must agree on the venue and all applicable federal laws must be met in 
the process. The Department believes the prudent course of action is to 
allow the legal system to render its decision regarding the disputed 
lands before instituting a legislative remedy. Therefore, the 
Department cannot support S. 2696 at this time.
    With respect to the City Of Albuquerque's desires to make 
improvements on this property, Reclamation has provided a license to 
the City which allows the use of those lands as proposed in the City's 
improvement plans.
    The Middle Rio Grande Conservancy District (District) was created 
by the Conservancy Act of 1923 to improve the economy of the Middle 
Valley by lowering the water table and providing flood protection and 
water for irrigation. In the 1940's, the District requested that 
Reclamation take over the operation of the District and retire its 
outstanding bonds. In September 1951, the District and Reclamation 
entered into a 50-year repayment contract in the amount of $15,708,567. 
A key component of the contract is Article 29, which states:

          Title to all works constructed by the United States under 
        this contract and to all such works as are conveyed to the 
        United States by the provision hereof, shall as provided in 
        Article 26, be and continue to be vested in the name of the 
        United States until otherwise provided for by Congress, 
        notwithstanding the transfer hereafter of any such works to the 
        District for operation and maintenance.

    Furthermore, the District acknowledged the need and desire to seek 
reconveyance after their debt was repaid when it testified in 1998 
before a committee of the New Mexico Legislature.
    Section 5 of the bill states that ``nothing in this act shall be 
construed to affect or otherwise interfere with any position set forth 
by any party in the lawsuit `` It is unclear to the Department how the 
passage of this legislation could not affect the lawsuit given that the 
ownership of the two parcels referenced in the bill is part of the 
lawsuit itself.
    Despite this disagreement, the District has been a good partner on 
this project and has retired its debt to the United States. While we 
believe that it is best to wait on the court's decision to settle this 
matter, we are always open to working with all interested parties to 
find acceptable solutions.
    Mr. Chairman, that concludes my remarks and I would be happy to 
respond to any questions the committee may have.

    Senator Dorgan. Commissioner, thank you very much for your 
statement. Next we will here from the Honorable Dr. Charles G. 
Groat, Director of the U.S. Geological Survey.
    Dr. Groat.

           STATEMENT OF CHARLES G. GROAT, DIRECTOR, 
       U.S. GEOLOGICAL SURVEY, DEPARTMENT OF THE INTERIOR

    Dr. Groat. Thank you, Mr. Chairman, members of the 
committee. I appreciate the opportunity to provide the views of 
the Department of the Interior on S. 2773, High Plains Aquifer 
Hydrogeologic Characterization, Mapping, Modeling and 
Monitoring Act. The administration agrees with the committee 
concerning the importance of ground-water monitoring and 
coordination of monitoring efforts among Federal, State and 
local entities. We especially appreciate the bipartisan efforts 
to sponsor the bill and also appreciate the value that the bill 
places on sound science as a guiding principle for management 
decisions.
    Before expressing support for the bill and its goals, I do 
want to mention two or three concerns that the administration 
has with the bill. First, that we be sure we have explored all 
possible existing programs as alternative means for 
accomplishing the goals of the bill, such as the National 
Cooperative Geological Mapping Act and our water partnership 
program. We also want to make the committee aware that the USGS 
and the Department of the Interior in the process of 
restructuring and reprioritizing our strategic plans and the 
programs that are adopted by new legislation or by new actions 
will be subject to prioritization within that process.
    And also, we just point out that this program is not 
included in our 2003 President's budget and so, should it pass, 
it would be subject to use of available resources during that 
period.
    Also, a couple of concerns conveyed by the Department of 
Justice that I want to convey to you, and that is the feeling 
that sections 3 and 4 may unconstitutionally require the States 
to take certain actions, and whether this language needs 
review, I would just submit to the committee staff and ask them 
to consider that.
    The resource challenge addressed by this bill is certainly 
a critical one. Irrigation water pumped from the aquifer has 
made the High Plains one of the Nation's most important 
agricultural areas. However, the benefits have been mitigated 
to some degree by the major declines in ground-water levels and 
the fact that water levels at increased pumping lists, they 
also decrease well yield and put a strain on the resource, 
raising concerns about the sustainability of irrigated 
agriculture in many parts of the High Plains, particularly 
those in the southern and central parts of the High Plains 
where as much as 50 percent of the aquifer has been dewatered 
in some of those areas.
    The bill directs the Secretary of the Interior acting 
through the U.S. Geological Survey in cooperation with, and 
this is an important aspect, State geological surveys and the 
water management agencies in the High Plain Aquifer States, to 
establish and carry out a program of characterization, mapping, 
modeling and monitoring of the High Plains Aquifer. And here 
again, as I started out by saying, this underpins the value of 
science in providing an understanding that can lead to wise 
management.
    This would be accomplished through mapping activities, 
analysis of rates at which the ground water is being withdrawn 
and recharged, and changes in water storage in the aquifer. And 
we would insure that data collected under this program is 
consistent with Federal Geographic Data Committee standards so 
that it is uniform across the whole aquifer system.
    The role identified for the Department of the Interior in 
the bill is consistent with the USGS's role in conducting 
extensive geological mapping and ground-water investigations in 
the Nation, and in this bill as in these other programs, in 
cooperation with State and local partners. Furthermore, the 
USGS has been active in programs in the High Plains Aquifer 
system for some time. We have offices in each of the States 
underlaying by the High Planes Aquifer system. These offices 
have a long history of ground-water monitoring and assessment 
activities within the aquifer.
    In fact, in the early 1970's, the USGS carried out the 
first comprehensive quantitative study of the High Plains 
Aquifer through the Regional Aquifer System program. With our 
partners in the cooperative water program, we continue to 
provide ground-water models and evaluate present and future 
state of the aquifer in some parts of the High Plains, 
although, and this is the critical point that the legislation 
addresses, the overall assessment of the aquifer is now over 
two decades old.
    And frankly, Mr. Chairman, that's not good enough. This 
program this legislation defines would modernize this 
assessment and would provide the necessary new information 
that's needed for improved understanding. More in-depth studies 
are required to determine the relevant importance of all the 
factors that affect the aquifer as well as its physical makeup, 
and improve the estimates of recharge, which is critical to 
projecting future water levels and their response to 
agricultural practices.
    We recognize in doing this the need to insure that any of 
our monitoring activities should complement and be coordinated 
with State activities.
    One suggestion we would have, Mr. Chairman, that is in 
order to insure cooperation between the USGS and the non-
Federal community, we suggest that language similar to that 
currently contained in the National Cooperative Geological 
Cooperative Mapping Act be inserted into section 3 of this 
legislation, specifically, and I quote: ``That the Federal 
share of cost of activities under the State component for any 
fiscal year shall not exceed 50 percent.'' This conforms to 
matching requirements we have in other parts of the 
legislation.
    In summary, a reliable source of ground water is an 
essential element of the economy of the communities of the High 
Plains. The goals of this bill are commendable. It contains 
provisions that are well within the scope of the expertise of 
the USGS and its State partners, and emphasizes a high level of 
coordination between the Department of the Interior and the 
States addressing an issue of significant economic concern both 
to the High Plains and to the nation.
    Thank you, Mr. Chairman. I would be happy to answer any 
questions.
    [The prepared statement of Dr. Groat follows:]

          Prepared Statement of. Charles G. Groat, Director, 
           U.S. Geological Survey, Department of the Interior

    Mr. Chairman and Members of the Committee, thank you for the 
opportunity to provide the views of the Department of the Interior 
(DOI) on S. 2773, the ``High Plains Aquifer Hydrogeologic 
Characterization, Mapping, Modeling, and Monitoring Act.'' The 
Administration agrees with the Committee concerning the importance of 
ground-water monitoring and coordination of monitoring efforts among 
Federal, State, and local entities. We especially appreciate the bi-
partisan efforts of the sponsors of the bill to address this important 
issue and the emphasis within the bill on the need for reliance on 
sound science.
    However, the Administration has a few concerns with this bill. The 
goals of this bill can be achieved without legislation, through better 
coordination of existing Federal and State programs. Further, the USGS 
and DOI are in the process of revising their strategic plan; while 
important, the proposed program would have to be taken into account 
among all DOI priorities as the strategic plan develops. The total 
costs of the proposed program are uncertain. Funding for this program 
is not included in the fiscal year 2003 President's budget, and would 
be subject to available resources.
    Irrigation water pumped from the aquifer has made the High Plains 
one of the Nation's most important agricultural areas. The intense use 
of ground water has caused major declines in ground-water levels. 
Water-level declines increase pumping lifts, decrease well yields, 
limit development of the ground-water resource, and raise concerns 
about the long-term sustainability of irrigated agriculture in many 
areas of the High Plains. The changes are particularly evident in the 
central and southern parts of the High Plains, where more than 50 
percent of the aquifer has been dewatered in some areas.
    The bill directs the Secretary of the Interior, acting through the 
United States Geological Survey (USGS), and in cooperation with the 
State geological surveys and the water management agencies of the High 
Plains Aquifer States, to establish and carry out a program of 
characterization, mapping, modeling, and monitoring of the High Plains 
Aquifer. This would be accomplished through mapping of the 
configuration of the High Plains Aquifer, and analyses of the rates at 
which ground water is being withdrawn and recharged, changes in water 
storage in the aquifer, and the factors controlling the rate of flow of 
water within the aquifer. Effective coordination of the data collection 
and monitoring efforts requires that any data collected under the 
program be consistent with Federal Geographic Data Committee data 
standards and that metadata be published on the National Spatial Data 
Infrastructure Clearinghouse.
    The role identified for DOI in this bill is consistent with USGS's 
leadership role in monitoring, interpretation, research, and assessment 
of the earth and biological resources of the Nation. As the Nation's 
largest water, earth, and biological science, and civilian mapping 
agency, USGS conducts the most extensive geologic mapping and ground-
water investigations in the Nation in conjunction with our State and 
local partners. Furthermore, the USGS has been active in a number of 
programs and investigations that involve the High Plains Aquifer, 
specifically.
    The USGS has offices in each of the eight States underlain by the 
High Plains Aquifer (Texas, Oklahoma, Kansas, Nebraska, South Dakota, 
Wyoming, Colorado, and New Mexico). These offices have a long history 
of ground-water monitoring and assessment activities within the 
aquifer. Existing USGS programs that are highly relevant to High Plains 
Aquifer issues include the Ground-Water Resources Program, National 
Cooperative Geologic Mapping Program, National Water-Quality Assessment 
(NAWQA) Program, National Streamflow Information Program, Water 
Resources Research Act Program, and the Cooperative Water Program.
    The USGS carried out the first comprehensive quantitative study of 
the High Plains Aquifer in the late 1970's through the Regional 
Aquifer-System Analysis (RASA) Program. With our partners in the 
Cooperative Water Program, we continue to provide ground-water models 
to evaluate the present and future state of the aquifer in some parts 
of the High Plains, although an overall assessment of the aquifer is 
now over two decades old.
    In response to the water-level declines, a ground-water monitoring 
program was begun across the High Plains in 1988 to assess annual 
water-level changes in the aquifer, an effort requiring collaboration 
among numerous Federal, State, and local water-resource agencies. Water 
levels continue to decrease in many areas of the aquifer, but the 
monitoring has indicated an overall reduced rate of decline of the 
water table during the past two decades. This change is attributed to 
improved irrigation and cultivation practices, decreases in irrigated 
acreage, and above normal precipitation during this period. More in-
depth studies are required to determine the relative importance of 
these different factors and to improve estimates of recharge rates, 
which is crucial to projecting future water levels and their response 
to changing agricultural practices.
    We recognize the need to ensure that any USGS monitoring activities 
should complement State monitoring activities. In order to ensure 
cooperation between USGS and the non-federal community, we suggest that 
language similar to that currently contained in the National 
Cooperative Mapping Act be inserted in Section 3 (2)(d)(2) of S. 2773. 
Specifically, ``The Federal share of the cost of activities under the 
State component for any fiscal year shall not exceed 50 percent'' (43 
U.S.C. Chapter 2, Section 31 c.).
    We have been advised by the Department of Justice, that Sections 3 
and 4 unconstitutionally require that States take certain actions. We 
recommend that the Committee examine these provisions to address the 
constitutional flaws.
    In summary, a reliable source of ground water is an essential 
element of the economy of the communities on the High Plains. The goals 
of the bill are commendable, it contains provisions that are well 
within the scope and expertise of the USGS, and it emphasizes a high 
level of coordination between the Department of the Interior and the 
States in addressing an issue of significant economic concern to the 
Nation. However, the Administration has concerns with the bill and any 
new funding would remain subject to available resources.
    Thank you, Mr. Chairman, for the opportunity to present this 
testimony. I will be pleased to answer questions you and other members 
of the Committee might have.

    Senator Dorgan. Dr. Groat, thank you very much.
    Senator Bingaman, do you have an opening statement?

         STATEMENT OF HON. JEFF BINGAMAN, U.S. SENATOR 
                        FROM NEW MEXICO

    The Chairman. Mr. Chairman, let me just say briefly, there 
are two bills that are part of your hearing today that are very 
important to us in my State, and that I very much appreciate 
you allowing to be part of this hearing.
    S. 2696, the Albuquerque Biological Park Title 
Clarification Act, which was put in at the request of the city 
of Albuquerque and the mayor of Albuquerque, and he is here to 
testify on that in one of the later panels.
    And then S. 2773, that we have just been hearing testimony 
on, that we think is also very important, helping to deal with 
the problems in the High Plains Aquifer.
    So thank you very much for having the hearing on these two 
bills in particular, and I look forward to asking some 
questions.
    Senator Dorgan. Senator Craig.
    Senator Craig. John, or Dr. Keys, you mentioned some 
concerns as it relates to definition as reimbursables as it 
relates to the MOA, and some other concerns about ambiguity in 
the language. We will be happy to work with you and the 
Department to make sure that this is well clarified before we 
move it out.
    Mr. Keys. Mr. Chairman, Mr. Craig, it's very easy to take 
care of. We have been working with the House side and have 
reached agreement with them, and we certainly think that that 
can be accomplished.
    Senator Craig. We will take a look at that work then. Thank 
you.
    Senator Dorgan. Senator Burns, do you have any questions of 
this panel?
    Senator Burns. I have no questions other than with 
Secretary Keys, we're looking forward to working with you and 
we can work out, I think, our differences up there too, John, 
and we look forward to working with you on that.
    Mr. Keys. Mr. Chairman, Senator Burns, we look forward to 
doing that.
    Senator Burns. That will be great.
    Senator Dorgan. Senator Bingaman.
    The Chairman. Thank you very much, Mr. Chairman. Let me ask 
first about S. 2696, ask Mr. Keys a couple questions about 
this. I'm somewhat confused about the position the Government 
is taking here, because my impression is that the impetus for 
this legislation was a suggestion from the Bureau of 
Reclamation that the city get legislation like this enacted. 
That was the way it was explained to me. The mayor, of course, 
is here to testify and he can clarify that. Let me just ask you 
ahead of time.
    I think his impression is that the city was asked to urge 
the delegation to pursue this legislation and did, and now the 
Bureau of Reclamation says they oppose the legislation, and 
that's a little confusing.
    Mr. Keys. Mr. Chairman, Senator Bingaman, before the 
lawsuit was filed, the United States with Reclamation 
representing it felt that we had title to those lands in 
question, and certainly we were willing to enter into 
arrangements with the city of Albuquerque to transfer those 
lands to them, and that was at the time the request was made 
for the legislation.
    In the meantime, there was a disagreement from the Middle 
Rio Grande Conservancy District that they owned the lands. They 
felt that since they had paid out their agricultural allocation 
of the project costs that they owned those lands. Certainly we 
don't agree with that, and certainly they didn't agree with 
that, so they filed a lawsuit.
    What we're saying is we need to let that lawsuit run its 
course before the legislation is passed. I'm not sure what 
would happen if the legislation went forward and the land was 
transferred without that lawsuit being decided. Not being an 
attorney, I don't know what mess that would make.
    The Chairman. Let me just tell you my own view on it. It's 
been a while since I filed suit to quiet title, but I think the 
idea of this legislation is to, as to these particular parcels, 
these two parcels, to make it very clear as to what the 
ownership is, and that would not affect the remainder of the 
litigation, the Middle Rio Grande Conservancy District's 
lawsuit and the Bureau of Reclamation dispute about that, that 
would continue as to everything else. But as to these parcels, 
it would clarify that in fact the city does own this land since 
the city paid for it. Am I confused on that?
    Mr. Keys. Mr. Chairman, Senator Bingaman, the question at 
hand is whether the Bureau of Reclamation or the Middle Rio 
Grande Conservancy District owns the lands. If they indeed are 
Reclamation lands then we would work with your committee for 
the title transfer to those lands to the city. If MRGCD owns 
the lands then I think they will probably charge the city for 
them.
    The Chairman. But now as I understand it, the Middle Rio 
Grande Conservancy District is not the one complaining about 
this litigation--I mean about this proposed legislation. They 
are not disputing the right of the city to go ahead and have 
ownership of these two parcels. The Bureau of Reclamation was 
willing to quit claim its interests to the city for a dollar, 
that was before all the litigation started.
    Mr. Keys. Yes.
    The Chairman. And what we are saying is let us just enact 
legislation to accomplish the extinguishment of the Federal 
Government's interests so that the city can own it.
    Mr. Keys. Mr. Chairman, Senator Bingaman, how about if I 
get one of our attorneys to come up and talk with you so that 
they can explain how they felt that it would confuse the issue 
if legislation is passed?
    The Chairman. Yes, I wish you would do that. Why don't you, 
if you could get your legal team to tell us how this is a 
problem for us to pass this, because quite frankly, this 
litigation may continue for a while, most litigation does, and 
we believe it's important to clear up the title to this 
property and we thought we could do that without any great 
controversy, and then of course we found that you are in 
opposition to this, which is a problem.
    Mr. Keys. I would be glad to do that.
    The Chairman. We would appreciate that very much.
    Director Groat, let me ask you, I appreciate your comments 
about the importance of this effort to better map and 
understand the problem with the High Plains Aquifer, and that 
of course is the purpose of the legislation. You indicate in 
your testimony that you have some suggestions related to the 
legislation, you mentioned some concerns. I just say to you 
that we are anxious to work with you to resolve those. We think 
this is important bipartisan legislation. Would you agree to 
work with us over the next few weeks so that when we come back 
into session in September we will be able to dispose of this?
    Dr. Groat. Senator, we agree that this is important 
legislation and feel that the details that need to be worked 
out are minor, and look forward to doing that.
    The Chairman. Thank you very much. Thank you, Mr. Chairman.
    Senator Dorgan. Senator Smith, we have heard from the two 
witnesses and are about to excuse them. If you have any 
statement you wish to make before we do that, or questions, I 
would be happy to let you do that.
    Senator Smith. Thank you, Mr. Chairman.
    I understand that contrary to my hopes in the statement, 
that the administration is opposing S. 1882, and that's been 
the testimony today, and I just hope they will work with us to 
get it so that you can support it, so we can move it. These 
small loan programs are pretty important to some small 
districts.
    Mr. Keys. Mr. Chairman, Senator Smith, we are more than 
happy to do that.
    Senator Smith. Thank you. And I wonder, Mr. Keys, if you 
can give me any update on Klamath Falls from your perspective. 
Is water flowing, are things okay?
    Mr. Keys. Mr. Chairman, Mr. Smith, the water is flowing. It 
is still 105 degrees and everything is on fire out there right 
now. We expect the water to flow to the end of the season and 
we expect a full delivery. Tomorrow is a cutback day on 
releases from Upper Klamath Lake, and certainly we have people 
in government-to-government consultation today with the tribes 
there on that cutback, so everything is on schedule to this 
date.
    Senator Smith. Thank you.
    Senator Dorgan. Commissioner and Director, thank you very 
much for being here today. We will excuse you and thank you for 
your testimony.
    The second panel that we will call will be Dan Keil, 
chairman, North Central Montana Regional Water Authority; Bruce 
Sunchild, Sr., vice chairman, Chippewa Cree Tribe, Box Elder, 
Montana; Jeff Raybould, chairman, Board of Directors, Fremont-
Madison Irrigation District, St. Anthony, Idaho; Peter Carlson, 
attorney, Will & Carlson, Inc., Washington, D.C. If those 
witness would come forward and take their positions at the 
table, we would appreciate it.
    As I indicated previously, the entire statement of the 
witnesses will be made a part of the permanent record and we 
would ask the witnesses for the purpose of this subcommittee to 
summarize. Mr. Keil, am I pronouncing your name correctly?
    Mr. Keil. Yes, sir.
    Senator Dorgan. Dan Keil, chairman, North Central Montana 
Regional Water Authority. Why don't you begin?

STATEMENT OF DAN KEIL, CHAIRMAN, NORTH CENTRAL MONTANA REGIONAL 
                  WATER AUTHORITY, CONRAD, MT

    Mr. Keil. Thank you, Mr. Chairman. For the record, my name 
is Dan Keil. I'm a farmer from north central Montana and am 
serving as chairman of the North Central Montana Regional Water 
Authority. I want to thank you for the opportunity to testify 
today in support of authorizing the Rocky Boys/North Central 
Regional Water System, S. 934. I would like to thank Senator 
Burns and Senator Baucus for their remarks and their strong 
support of this project.
    I also would like to thank the State of Montana. They are 
not here to testify, but they submitted a statement in support 
of this. The Governor is in strong support, this governor and 
the previous governor both, of this project. We have been 
working on it for a considerable length of time.
    I also have in addition to that, the chairman of the Hill 
County Water District, which is one of the participating 
systems.
    This project, as you can see from the map and the map 
that's attached to the testimony,* is about 8 percent of the 
total area of the State of Montana that's being served by this, 
and that's a pretty good sized area. It's basically a 
combination of rural water systems that are there, the 
communities that are there, and it would be a wholesale water 
supply system to those communities to solve some of the 
problems that they are experiencing now.
---------------------------------------------------------------------------
    * The map has been retained in subcommittee files.
---------------------------------------------------------------------------
    This is an area that is short of ground water, basically 
there is none. What little bit there is is concentrated in a 
couple areas, and the rest of the people that are in that area 
like my water system, parts of that, when we put that thing in 
25 years ago, were hauling water 25, 30 miles one way. Surface 
water supplies are also limited and suffer from water quality 
problems.
    This is a joint project, as Senator Baucus stated, between 
the Chippewa Cree Tribe and the residents off of the adjoining 
communities. This North Central Montana Regional Water 
Authority includes 16 rural water districts and 2 water user 
associations. Most of these systems are small, with limited 
customer base. It is increasingly difficult for these systems 
to satisfy the regulatory requirements imposed by the Federal 
Government through the Safe Drinking Water Act.
    I was here in 1996 testifying in front of the EPW Committee 
about the amendments that were being proposed at that time to 
the Safe Drinking Water Act, and those were solving one 
problem, but they also created more problems. I have been 
involved in drinking water system work for 30 years.
    When my little area out there, we got together and obtained 
a drinking water system from the Federal Government that was 
established to supply an anti-ballistic missile base. In 1972, 
President Nixon went to Russia and signed the first SALT 
agreement, and that's what--that project was closed down, and 
we formed a water district off of that to serve portions of 
five counties. I was chairman of that system for quite a while, 
I also served on the National Rural Water Association board.
    The Department of Environmental Quality, which implements 
the Safe Drinking Water Act in Montana, has declared three of 
the rural water districts to be out of compliance with this 
act. At least 12 other systems are expected to have difficulty 
meeting future requirements. One system has been ordered to 
obtain authorization this year or seek another source of water 
to supply their customers. A number of the systems are under 
boil orders at this time.
    Due to the small customer base of the districts, they 
cannot individually afford to construct their own treatment 
plants or develop alternative sources of water. A regional 
water system is the only feasible approach to meeting north 
central Montana's need for clean drinking water.
    The reoccurring drought is another problem. We have had 
that for 5 years, we are approaching the sixth year, but it did 
rain finally in that area, so--that didn't serve, because it's 
such a big area, not all of them got it, but it has relieved 
some of the restrictions. The main streets of our small towns 
are dying and without a reliable source of safe drinking water, 
there is little to attract new businesses. The small 
communities and rural areas of north central Montana and the 
reservation are struggling to meet the needs of their people 
and satisfy the requirements of the Safe Drinking Water Act, 
but cannot do it on their own.
    The proposed rural water system takes advantage of 
available storage at the Bureau of Reclamation's Lake Elwell. 
The Rocky Boy will utilize their allotment out of that lake and 
the non-reservation users will contract with the Bureau of 
Reclamation for additional water. A single water treatment 
plant will be built to provide safe water to the existing rural 
water districts and the reservation. This single treatment 
plant will allow the users to take advantage of the economies 
of scale in meeting current and future requirements of the Safe 
Drinking Water Act.
    The water authority is prepared to contribute a non-Federal 
cost share of 25 percent, which is equivalent to that required 
for other rural water systems such as Washone and Lewis and 
Clark. In addition, the water authority has already invested 
millions of dollars in existing water delivery systems which 
will continue to be used to deliver water from the rural water 
systems core pipeline to the ultimate water users. While not 
recognized in the bill as part of the non-Federal cost share, 
the use of existing delivery systems significantly reduces the 
overall cost of the project.
    The water authority is also responsible for all off-
reservation operation and maintenance costs. While we are 
willing to do our part, we simply do not have the resources to 
meet the requirements of the Safe Drinking Water Act and 
provide good clean drinking water to our system.
    We ask you for your support in helping us to make safe 
drinking water a reality in our State. Thank you for the 
opportunity to come and appear.
    [The prepared statement of Mr. Keil follows:]

    Prepared Statement of Dan Keil, Chairman, North Central Montana 
                  Regional Water Authority, Conrad, MT

    Mr. Chairman and members of the subcommittee, my name is Dan Keil. 
I am Chairman of the North Central Montana Regional Water Authority. 
Thank you for the opportunity to testify before the subcommittee in 
support of authorizing the Rocky Boys/North Central Montana Regional 
Water System. I would also like to thank Senator Max Baucus and Senator 
Conrad Burns for their strong and continuing support for this project.
    The Rocky Boys/North Central Montana Regional Water System will 
provide a safe and dependable municipal, rural and industrial water 
supply for the Rocky Boy's Reservation and the public water supply 
systems that comprise the North Central Montana Regional Water 
Authority. Speaking on behalf of the off-Reservation portion of the 
project, I can assure you that the communities in north central Montana 
strongly support both the on-Reservation and off-Reservation components 
of the project.

                       NEED FOR THE WATER SYSTEM

    The Rocky Boys Reservation and north central Montana are plagued by 
problems with water quality and supply. The off-Reservation public 
water supply systems are unable to meet the requirements of the Safe 
Drinking Water Act. According to the Montana Department of 
Environmental Quality (DEQ), three of the public water supply systems 
which would be served by the proposed regional system are out of 
compliance with the federal Act. Of these three, DEQ has issued an 
administrative order to one system requiring an alternative source of 
water and expects to bring enforcement actions against the other two 
systems in the very near future.
    The Montana DEQ prioritized the existing water systems according to 
their expected difficulty in meeting future regulatory requirements 
based upon current EPA proposals and the 1996 amendments to the Safe 
Drinking Water Act. As can be seen from the attached table, almost all 
of the existing systems are either out of compliance or will have 
difficulty meeting future regulatory requirements unless they upgrade 
their systems.
    Many of the systems treat their water with chlorine which in turn 
may cause problems with elevated levels of disinfection by-products. 
Other systems have problems with bacterial contamination and elevated 
levels of total dissolved solids, iron, manganese, lead, copper, 
sulfate and sodium. Boil orders either have been issued in the past or 
are presently in effect for a number of the systems.
    Many area residents are not served by any public water system. Due 
to the limited availability and poor quality of groundwater, these 
residents must often haul their own water. The available water supply 
fails to meet water quality standards and poses real health risks to 
the area's population.
    Water quality problems are exacerbated by water supply issues. 
Because of the general lack of good quality groundwater, most of the 
area's larger public water systems use surface water supplies, 
including the Milk River. As recognized in the North Central Montana 
Regional Water System Planning/Environmental Report dated May 2000, the 
availability of direct flow supplies from the Milk River is limited by 
the loss of active storage due to the rapid rate of sedimentation, 
unused Canadian treaty rights and unquantified Indian reserved water 
rights. Public water systems relying on the Milk River have had to 
implement strict water rationing requirements.
    The water availability problems have been aggravated by drought. In 
2000 and 2001, the U.S. Department of Agriculture classified all 56 
Montana counties under drought disaster status. A number of the 
counties which will be served by the proposed regional water system 
have received a drought disaster classification for the last five 
years. As of June 13, 2002, the National Oceanic and Atmospheric 
Administration predicted the drought in Montana is likely to persist 
with some areas experiencing short-term improvements. In recognition of 
the continuing drought, the U.S. Department of Agriculture has already 
granted Montana drought disaster status for 2002.
    The poverty rate for all eight counties which will be served by the 
regional water system exceeds the national average. According to the 
U.S. Census Bureau, 19.8 percent of the people in Hill County and 17.4 
percent in Toole County live in poverty. These are two of the counties 
which will be served by the regional water system. The Montana 
Department of Labor & Industry reports the unemployment rate on the 
Rocky Boys Reservation at 27 percent. According to the department, 
unemployment on the Rocky Boys Reservation is more than twice that on 
other Montana reservations and is the highest in the state. These 
statistics only reflect those persons actively looking for work and do 
not reflect the true situation on the Reservation where many have 
become discouraged and given up hope of finding a job. In 1999, this 
committee's report on the Rocky Boys Reservation's Indian reserved 
water rights settlement estimated unemployment on the Reservation at 
nearly 70 percent. A reliable source of safe drinking water is 
necessary to improve the low standard of living on the Reservation and 
in the surrounding area.
    A dependable supply of water is also essential to ongoing efforts 
to attract new businesses to the area in order to provide for future 
economic growth. In addition to long term benefits, the regional water 
project will provide an immediate economic boost for north central 
Montana and the Rocky Boys Reservation. Assuming labor costs for the 
project at 25 percent of the total construction budget, the project 
will generate approximately $38.75 million in wages via 1,242 
construction man years. These construction dollars will provide a much 
needed stimulus to the regional economy.
    The North Central Montana Regional Water Authority, along with the 
Rocky Boys Reservation, the State of Montana, and the Bureau of 
Reclamation, has studied possible alternatives to supply water to the 
region. The option of updating existing public water supply systems to 
comply with the Safe Drinking Water Act was rejected due to the high 
cost. Another option, using Missouri River water, was rejected because 
it would introduce arsenic from the Missouri into the Milk River basin, 
thereby degrading the water quality of the receiving streams. Obtaining 
additional water from the Milk River was also studied but rejected due 
to the limited physical and legal availability of water. The use of 
additional groundwater sources was also investigated. This option was 
not feasible because there is very little groundwater physically 
available, and the groundwater that is available is of poor quality or 
is under the influence of surface water which according to the Safe 
Drinking Water Act requires treatment. Of all the alternatives 
reviewed, the proposed regional water project is the only one which 
provides a dependable water supply while offering the lowest capital 
project and life-cycle costs.

                              THE PROJECT

    Water for the Rocky Boys/North Central Montana Regional Water 
System will be diverted from Lake Elwell, a Bureau of Reclamation 
reservoir on the Marias River, which is located approximately 40 miles 
west of the Rocky Boys Reservation. As part of the Rocky Boys reserved 
water rights settlement, the Chippewa Cree Tribe was allocated 10,000 
acre-feet per year from storage in Lake Elwell. The off-Reservation 
portion of the regional water system will contract with the Bureau of 
Reclamation for purchase of stored water from Lake Elwell. There is 
sufficient storage available in the reservoir to provide a reliable 
supply for the project while satisfying recreational and fishery needs.
    Studies conducted over the last decade, in cooperation with the 
Bureau of Reclamation, the State of Montana and the Tribe, have all 
identified Lake Elwell and the Marias River as the appropriate source 
of water for the system. Of the other possible water sources, water 
availability in the Milk River is severely limited, the Missouri River 
has elevated arsenic levels which cause water quality concerns, and 
adequate groundwater simply does not exist. Lake Elwell is the most 
practical source of water for the project.
    A water treatment plant, using conventional filtration, will be 
located near the intake on Lake Elwell. The water will be treated to 
meet both the primary and secondary requirements of the Safe Drinking 
Water Act standards. A core pipeline will convey water from the 
treatment plant to the Rocky Boys Reservation. A series of transmission 
pipelines will also provide water to smaller distribution lines 
belonging to the area's off-Reservation public water supply systems. 
The regional water system will take advantage of the infrastructure of 
these existing systems. When completed, the regional water system will 
provide a safe and dependable water supply for a projected 30,000 
people in 2045. Water will be provided to all or parts of eight 
counties including 10,700 square miles in north central Montana.
    Without the proposed centralized water treatment plant, most of the 
participating systems would be required to build new or to 
significantly upgrade existing conventional water treatment plants. Due 
to the low population densities and limited income potential in north 
central Montana, individual communities, both on and off the 
Reservation, cannot afford their own treatment plants. The existing 
public water supply systems are also concerned about additional 
upgrades which may be necessary in the future to satisfy changing 
federal and state regulation. A central treatment plant will allow 
these existing systems to economically meet both the current and any 
future requirements of the Act.
    The project will receive power from the Pick Sloan Missouri Basin 
Program. All of the other MR&I regional water systems recently 
authorized by Congress in the Upper Missouri River Basin have 
benefitted from Pick Sloan power. The North Central Montana project 
should be treated similarly, particularly since Montana produces 
approximately 22 percent of the Pick Sloan power but consumes only 6.5 
percent.
    The estimated total project cost is $200 million, the Rocky Boys 
Reservation portion of which is $120 million. The bill proposes the 
federal share of the off-Reservation construction to be 75 percent. The 
North Central Montana Regional Water Authority has worked with the 
State of Montana to secure funding for the non-federal share of the 
capital costs. A portion of the approximate $20 million non-federal 
share of the project has already been set aside . The Authority will 
also be responsible for the cost of operating, maintaining and 
repairing the off-Reservation portion of the project.
    In testimony before the House subcommittee, the Bureau of 
Reclamation expressed concern about the impact of the project on its 
budget and suggested a programmatic approach involving a number of 
federal and non-federal agencies in the funding of regional water 
systems. The Authority is willing to work with the Bureau to address 
its funding concerns. The bill has been drafted to include a cost share 
requirement similar to recent MR&I projects authorized by Congress. We 
recognize that other federal agencies have a role in ensuring safe 
drinking water. We also recognize that our North Central Montana 
communities need this project authorized now. We have a member system 
which is subject to an administrative order and schedule for water 
quality compliance, and cannot afford further delay. We ask Congress to 
authorize this project while we work with the Administration on an 
equitable funding approach.
    The north central Montana communities and the Tribe have been 
working together on the project development since 1992, having formed 
an Ad Hoc Committee in 1993. Off-Reservation and Tribal communities 
worked with the 1999 Montana Legislature to enact legislation allowing 
establishment of regional water authorities and creating a state 
regional water system fund. This type of cooperation is needed to 
benefit all Montanans. Recognizing the area's need, the State of 
Montana, local entities and the Tribe agreed to seek federal 
authorization for the project. This joint commitment is evidenced in 
the reserved water rights compact negotiated between the Chippewa Cree 
Tribe, the State of Montana, and the federal government.
    Sixteen rural water districts, two water users associations, and 
several Hutterite colonies originally expressed an interest in the 
project and paid preliminary fees to demonstrate their earnestness. I 
have attached to my testimony a list of the participating off-
Reservation entities. In addition, more than 145 households not 
presently served by a water system have expressed interest in receiving 
water. All of the public water systems on the attached list are members 
of the North Central Montana Regional Water Authority.
    The people of north central Montana and the Rocky Boys Reservation 
presently do not have a reliable source of water. The proposed regional 
water system will provide water to an area historically afflicted by 
water supply and quality problems. We ask this subcommittee's support 
in passing this important legislation to protect the social and 
economic future of our region.
    Thank you again for the opportunity to testify in support of the 
Rocky Boys/North Central Montana Regional Water System. I would be 
pleased to answer any questions.

    Senator Dorgan. Mr. Keil, thank you very much for being 
here. Next we will hear from Bruce Sunchild, Sr., vice 
chairman, Chippewa Cree Tribe, in Box Elder, Montana.
    Mr. Sunchild, you may proceed.

        STATEMENT OF BRUCE SUNCHILD SR., VICE CHAIRMAN, 
               CHIPPEWA CREE TRIBE, BOX ELDER, MT

    Mr. Sunchild. Mr. Chairman, members of the subcommittee, my 
name is Bruce Sunchild, Sr. I am the vice chairman of the 
Chippewa Cree Tribe of the Rocky Boy's Reservation and co-chair 
of the Rocky Boy's North Central Montana Regional Water System 
coordinating committee. I have a written statement that I have 
submitted for the record and I will now summarize my remarks.
    I would like to thank the honorable chairman of the 
subcommittee and members of the Subcommittee on Water and Power 
for scheduling this hearing. I would also like to thank our 
Senators, Montana Senators Conrad Burns and Max Baucus for 
introducing this important legislation and for their strong and 
continued support for this project.
    The Chippewa Cree Tribe and North Central Regional Water 
Authority are jointly seeking enactment of S. 934, Federal 
legislation authorizing the Rocky Boy's North Central Montana 
Regional Water System. This water system will provide a safe 
and reliable municipal rural industrial water supply for the 
Rocky Boy's Reservation and our neighboring off-reservation 
communities.
    Mr. Chairman, the Rocky Boy's Reservation is a place of 
tremendous unemployment where 39 percent of the people live 
below the poverty level. The basic level of infrastructure that 
most Americans take for granted are lacking on this 
reservation. One of those areas where we are lacking is that we 
don't have a good water supply system for municipal, rural or 
industrial purposes. Unless we can attract businesses to our 
reservation, we will never create the jobs necessary to 
establish a sustainable economy.
    We certainly cannot do so without an adequate water supply. 
Presently we don't even have sufficient water for drinking 
purposes, not to mention sufficient water to attract businesses 
or to allow our agricultural community to grow. Study after 
study has identified this as a fundamental issue we must 
address to have a permanent viable homeland. Ground water is 
the primary source of domestic water within the Rocky Boy's 
Reservation.
    In addition to our limited water supply, we lack an 
adequate water delivery infrastructure system. Of the various 
sources of ground water on the reservation, only the shallow 
alluvial bedrock aquifers have limited potential for 
development. The other ground water sources either exceed the 
criteria set by the Safe Drinking Water Act, are too expensive 
to develop, or high concentrations of chloride sodium sulfate, 
which makes the water undesirable for domestic use.
    Wells generally have a low yield, producing 10 gallons per 
minute or less water. Historically these private wells are used 
for a period of time and then abandoned due to the decrease in 
yields. As yields decrease, the water quality also decreases. 
There are very few alternatives for providing water on Rocky 
Boy's Reservation. Studies have shown there are simply no 
reliable sources of surface ground water on the reservation to 
serve the needs of the reservation. These studies conducted by 
the tribe, the Bureau of Indian Affairs, and the Indian Health 
Service, have all concluded that there is a need for a 
reservation-wide domestic water system.
    The water rights of the Chippewa Cree as described in 
Public Law 106-163, the Chippewa Cree Water Supply Enhancement 
Act of 1999 ratified the compact entered into by the tribe and 
the State of Montana. As part of the settlement, the tribe 
received an allocation of 10,000 acre-feet per year of stored 
water from the Bureau of Reclamation in Lake Elwell, also 
referred to as Tiber Dam.
    The settlement also provided for an appropriation of $15 
million as recognition of a need for a new tribal municipal 
water system and to begin development of the future water 
supply system for the reservation.
    The proposed project as authorized by S. 934 is an 
innovative collaborative solution to the need of both the tribe 
and the north central part of Montana for an MR&I system. 
Discussion of the proposed project began during the compact 
negotiations between the tribe and the State of Montana. It was 
recognized as a unique opportunity for the tribe and off-
reservation neighbors to cooperate for the benefit of both 
communities. In many areas in this country, competing use of 
water could create litigation between on- and off-reservation 
water users. To be cooperating in this manner as we have is 
unusual and something that we are all proud of.
    Water will be diverted from the lake into a common water 
quality treatment plant. The water will be treated to meet all 
criteria of the Safe Drinking Water Act. This centralized 
treatment plant will eliminate the need for each community to 
build its own treatment plant. It will also simplify the 
process of upgrading the plant to meet changing requirements of 
the Safe Drinking Water Act. Because all the water will be 
treated to standards, reservation residents will uniformly have 
access to safe drinking water.
    A core pipeline will convey the water from the treatment 
plant to Rocky Boy's Reservation. Smaller distribution lines 
will then convey the water to various communities and users on 
the reservation. The tribe proposes to use the $15 million 
settlement money to upgrade our existing water delivery systems 
to receive the imported water.
    This project will dramatically enhance the health and 
quality of life and economic development potential for our 
reservation and region. This project----
    The Chairman [presiding]. You can just continue to ignore 
those buzzers.
    Senator Burns. That's for somebody else.
    The Chairman. We ring those to be sure everyone is awake.
    [Laughter.]
    Mr. Sunchild. I appreciate that. This project will allow 
the Chippewa Cree Tribe members to realize the goal of self-
determination and will provide for the first time ever a safe 
reliable source of drinking water on the reservation, but it 
will also be the cornerstone of the tribe's current and future 
economic development plans.
    Mr. Chairman, over the course of the last quarter century 
the Federal Government has strongly urged tribes to settle 
their water rights and claims so as to quantify the extent of 
the tribal rights and to create certainty for off-reservation 
residents. While we did that, we settled on our water rights 
and the United States ratified that settlement through Public 
Law 106-163. However, the settlement of water rights only 
benefits a tribe if there is a method of putting that water to 
some beneficial use.
    The agreement with the West bypassed Indian Country, Mr. 
Chairman. Additionally, for the last century as States and 
local governments established water systems, they often forgot 
about Indian Country, at best. At worst, they endeavored to 
divert the water system before it reached the reservation. Now 
that Congress has the opportunity to do the right thing and 
assist both Chippewa Cree and a dozen non-Indian communities in 
north central Montana who cannot presently comply with 
established drinking water standards.
    H.R. 1946 created an opportunity to accumulate and 
negotiate our water rights into a proverbial win-win situation. 
I must conclude by saying we are concerned by the comments made 
about this legislation by the BOR at a hearing in April before 
the House Resources Committee. The problem we have with BOR's 
previous testimony which may be presented again today is that 
they seem to be saying that once we settle our water rights 
claim, it had enacted the Public Law with the Settlement Act, 
that they should have nothing more to do with the tribes in our 
region, or surrounding neighborhoods in north central Montana.
    The fact is, the powers within the Federal Government 
decided that the legal liability they may have for not 
previously protecting our water was such that $15 million for 
the water settlement was acceptable, but that a more expensive 
pipeline and water treatment facility would not be justified 
based on the strength of our claim. There are speculative 
estimations led by attorneys concerned with this that costs 
relate to the damages. They have no connection to what it 
actually costs to deliver water.
    Clearly the fact that the United States agreed in the 
Settlement Act to reserve 10,000 acre-feet of water for the 
Chippewa Cree Tribe in the Federal reservoir 50 miles away 
implied that there would have been a method of delivering the 
water to the reservation. We would not have agreed to have this 
water reserved for the tribe if there was not a method of 
getting it to the reservation. At this time, at the time of the 
settlement, it was agreed that issues of delivering water would 
have to be undertaken through a subsequent act of Congress. We 
are now at that point in time where we need the subsequent act 
of Congress.
    We are not contending that the United States is legally 
liable if it does not pay for the water in Tiber to be 
delivered to the reservation. We are contending that there are 
moral and common sense reasons why this should happen. The 
Settlement Act clearly anticipated that we would be returning 
to this body at a future point in time. It was also sensible to 
include the surrounding non-Indian communities who are unable 
to comply with the Safe Drinking Water Act, who are desperately 
in need of a supply of water.
    Mr. Chairman, my written testimony describes the numerous 
studies that have examined how to get us that 10,000 acre-feet 
of water from Tiber. I will not summarize those studies at this 
hearing. It is safe to say that those studies conclude the 
pipeline system authorized by this legislation is the most 
viable and preferred alternative. I have a copy here of a study 
that was submitted, so I will leave that here for the record.
    We urge the enactment of S. 934. Again, we appreciate our 
friends Max Baucus, Conrad Burns for introducing the bill, and 
hope that you will now quickly mark it up and move it to the 
floor of the Senate. Thank you again for the opportunity to 
testify in support of this important and necessary project. I 
will be pleased to answer any questions.
    [The prepared statement of Mr. Sunchild follows:]

       Prepared Statement of Bruce Sunchild, Sr., Vice Chairman, 
   Chippewa Cree Tribe of the Rocky Boy's Reservation, Box Elder, MT

    Mr. Chairman and members of the Subcommittee, my name is Bruce 
Sunchild, Sr. I am the Vice-Chairman of the Chippewa Cree Tribe of the 
Rocky Boy's Reservation and Co-Chairman of the Rocky Boy's North 
Central Montana Regional Water System Coordinating Committee. I would 
like to thank the Honorable Chairman Byron Dorgan and the members of 
the Subcommittee on Water and Power for scheduling this hearing. I 
would also like to thank our Montana Senators, Conrad Burns and Max 
Baucus, for introducing this important legislation and for their strong 
and continuing support for this project.
    The Chippewa Cree Tribe and the North Central Regional Water 
Authority are jointly seeking the enactment of S. 934, federal 
legislation authorizing the Rocky Boy's/North Central Montana Regional 
Water System. The water system will provide a safe and reliable 
municipal, rural, and industrial water supply for the Rocky Boy's 
Reservation and our neighboring off-reservation communities.

                       NEED FOR THE WATER SYSTEM

    This project is essential to our Tribes' goal of establishing a 
self-sustaining homeland. The Rocky Boy's Reservation, located in north 
central Montana, consists of more than 120,000 acres, which are home to 
approximately 3,500 Tribal members who reside on the reservation. We 
have a rapid population growth rate that exceeds 3% annually. 
Unemployment on the Rocky Boy's Reservation is extraordinarily high and 
approximately 39% of Rocky Boy's young, rapidly growing population 
lives below the poverty level. A dependable source of high quality 
water is needed to enable Tribal members and other Reservation 
residents to achieve an adequate standard of living.
    The Chippewa Cree Tribe has made important strides in economic 
development over the past ten years in the areas of production of 
cattle, grain, timber and tourism. Nonetheless, studies have 
demonstrated that the reservation cannot sustain its current rate of 
growth, much less provide for economic growth, without additional 
supplies of water for drinking, agricultural and municipal and 
industrial purposes. Proposed expansions of our tribal college and 
other enterprises also cannot proceed until new, firm water supplies 
are located. The Indian Health Service has concluded that an imported 
water supply is the only viable option for supplying long-term Tribal 
Municipal, Residential, and Industrial (MR&I) needs.
    A safe and reliable water supply is a cornerstone of economic 
development. The assurance of an adequate supply of high quality 
municipal, rural and industrial water will enable the Tribe to pursue 
current and future economic development. It will also allow current and 
future Reservation residents to enjoy a higher quality of life through 
improved health conditions, more employment opportunities, and an 
overall increased level of economic development.

      THE ROCKY BOY'S/NORTH CENTRAL MONTANA REGIONAL WATER SYSTEM 
                        IS THE BEST ALTERNATIVE

    Groundwater is the primary source of domestic water within the 
Rocky Boy's Reservation. In addition to our limited water supply, we 
lack an adequate water delivery infrastructure system. Of the various 
sources of groundwater on the Reservation, only the shallow alluvial 
and bedrock aquifers have limited potential for development. The other 
groundwater sources either exceed the criteria set by the Safe Drinking 
Water Act, are too expensive to develop or have high concentrations of 
chloride, sodium, and sulfate which make the water undesirable for 
domestic use.
    Although the quality of the water in the shallow alluvial aquifer 
is generally acceptable, the quantity is inadequate. Wells in this 
aquifer generally have low yields, producing 10 gallon per minute or 
less of water. Historically, these private wells are used for a period 
of time and then abandoned due to decreasing yields. As yields 
decrease, the water quality also often decreases. Furthermore, these 
wells are frequently connected hydrologically to the major water 
courses where the potential for pollution is significant. Recently, 
drought relief monies were obtained to build new wells for the current 
municipal system. However, lack of recharge to the shallow bedrock 
aquifers on the Reservation severely limits water yield.
    There is simply not enough good quality groundwater to meet the 
Tribe's current needs, much less our future needs. Surface water 
sources are also limited in quantity, cannot provide a reliable source 
of water and are allocated to irrigation. As a result, many Tribal 
members have to haul water for their domestic use.
    There are very few alternatives for providing water to the Rocky 
Boy's Reservation. Studies have shown there are simply no reliable 
surface and groundwater on-reservation sources to serve the needs of 
the Reservation. These studies, conducted by the Tribe, the Bureau of 
Indian Affairs, and the Indian Heath Service, have all concluded that 
there is a need for a Reservation-wide domestic water supply system.

                           TRIBAL WATER RIGHT

    The water right of the Chippewa Cree Tribe, as described in Public 
Law 106-163, the ``Chippewa Cree Tribe of the Rocky Boy's Reservation 
Indian Reserved Water Rights Settlement and Water Supply Enhancement 
Act of 1999,'' ratified the Water Compact entered into by the Tribe and 
the State of Montana. As part of the water settlement, the Tribe 
received an allocation of 10,000 acre-feet per year of stored water 
from the Bureau of Reclamation in Lake Elwell, also referred to as 
Tiber Reservoir. The settlement also provided for an appropriation of 
$15 million as recognition of the need for a new Tribal municipal water 
system and to begin development of a future water supply system for the 
Reservation.

                              THE PROJECT

    The proposed project is an innovative and collaborative solution to 
the need of both the Tribe and the north central part of Montana for an 
MR&I system. Discussion of the proposed project began during the 
compact negotiations between the Tribe and the State of Montana. It was 
recognized as a unique opportunity for the Tribe and its off-
reservation neighbors to cooperate to the benefit of both communities. 
In many areas of this country, competing uses of water would create 
litigation between on and off-reservation waters users. To be 
cooperating in the manner we have is unusual and something that we are 
all proud of.
    Lake Elwell is a Bureau of Reclamation facility located 50 miles 
west of the Rocky Boy's Reservation. The availability of thousands of 
acre feet of unallocated water in Tiber Reservoir provides the 
opportunity to meet the water needs of the Tribe and neighboring north 
central regional communities. P.L. 106-163 allocated 10,000 acre-feet 
per year of water from the lake to the Tribe.
    Water will be diverted from the lake into a common water quality 
treatment plant. The water will be treated to meet all of the criteria 
of the Safe Drinking Water Act. This centralized treatment plant will 
eliminate the need for each community to build its own treatment plant. 
It will also simplify the process of upgrading the plant to meet 
changing requirements of the Safe Drinking Water Act. Because all of 
the water will be treated to standards, Reservation residents will 
uniformly have access to safe drinking water.
    A core pipeline will convey water from the treatment plant to the 
Rocky Boy's Reservation. Smaller distribution lines will then convey 
the water to the various communities and users on the Reservation. The 
Tribe proposes to use our $15M in settlement monies to upgrade our 
existing water delivery system to receive the imported water.
    The estimated total cost of the project is $200 million. The tribal 
portion of the project is estimated at $120 million. All costs of the 
reservation system, including operation and maintenance, will be a 
federal responsibility.
    This project will dramatically enhance the health, quality of life 
and economic development potential of our Reservation and region. This 
project will allow Chippewa Cree Tribal members to realize their goal 
of self-determination and will provide, for the first time ever, a safe 
and reliable source of drinking water on the Reservation. It will also 
be the cornerstone for the Tribe's current and future economic 
development plans. I urge your support for this project.

                         HISTORICAL PERSPECTIVE

    Mr. Chairman, in the landmark 1908 decision where the Winters 
Doctrine was established, the Supreme Court ruled that when the United 
States established federal Indian reservations, there had to be 
sufficient water reserved for the tribes to establish those 
reservations as permanent tribal homelands. Over the course of the last 
quarter century, the federal government has also strongly urged tribes 
to settle their water rights claims so as to quantify the extent of the 
tribal right and create certainty for off-reservation residents who 
will almost certainly have a junior water right to the tribe. Well, we 
did that. We settled our water rights and the United States ratified 
that settlement in P.L. 106-163. However, the settlement of a water 
right only benefits a tribe if there is a method of putting that water 
to some beneficial use. The greening of the west bypassed Indian 
country, Mr. Chairman. Additionally, for the last century, as state and 
local governments established water systems, they too often forgot 
about Indian country--at best. At worst they endeavored to divert our 
water before it reached the reservations. Now the Congress has an 
opportunity to do the right thing and to assist both the Chippewa Cree 
Tribe and the dozens of non-Indian communities in North Central Montana 
who cannot presently comply with established drinking water standards. 
H.R. 1946 creates an opportunity to culminate the negotiation of our 
water rights into a proverbial win-win situation.

                      RESPONDING TO BOR'S CONCERNS

    We are concerned by comments made about S. 934 (or more 
specifically, about H.R. 1946, the House counterpart bill) by the BOR 
at a hearing in April before the House Resources Committee. The problem 
we have with the BOR's previous testimony--which may be presented again 
today--is that they seem to be saying that once we settled our water 
rights claim and had it enacted into law (P.L. 106-163 or ``Settlement 
Act''), that they should have nothing more to do with our Tribe, our 
region, or our surrounding neighbors in north central Montana. The fact 
is that the powers that be within the federal government decided that 
the legal liability they may have for not previously protecting our 
water was such that a $50 million water settlement was acceptable but 
that a more expensive pipeline and water treatment facility could not 
be justified based on the strength of our claim. These are speculative 
estimations made by attorneys concerned with costs related to damages; 
they have no connection to what it costs to actually deliver water. 
Clearly, the fact that the United States agreed in the Settlement Act 
to reserve 10,000 acre feet of water for the Chippewa Cree Tribe in a 
federal reservoir that is 50 miles away implied that there would have 
to be a method delivering that water to the reservation. We would not 
have agreed to have this water reserved for the Tribe if there was not 
going to be a method of getting it to us. At the time of the Settlement 
Act, it was agreed that the issue of delivering water would have to be 
undertaken through a subsequent act of Congress. We are now at that 
spot in time where we need the subsequent act of Congress. We are not 
contending that the United States is ``legally liable'' if it does not 
pay for the water in Tiber to be delivered to the reservation; we are 
contending there are moral and common sense reasons why this should 
happen and the Settlement Act clearly anticipated that we would be 
returning to this body at a future point in time. It also makes sense 
to include the surrounding non-Indian communities who are not able to 
comply with the Safe Drinking Water Act and who are desperately in need 
of a supply of water.
    We are submitting to the Committee the results of a comprehensive 
study funded by the EPA and the state of Montana that we undertook in 
conjunction with HKM Engineering. BOR provided technical oversight to 
this investigation. This study examined alternatives on a region-wide 
basis (as opposed to on-reservation only), which is what S. 934 would 
authorize. This study determined that transporting water from the Tiber 
Reservoir to serve the Reservation and the 10,700 square mile service 
area that comprises the North Central Montana Regional Water System--
7.3 percent of the total land area of the state of Montana--to be the 
preferred alternative. This is the regional MR&I system supported by 
the Tribe and State in the negotiated water rights compact.
    The Settlement Act authorized two additional studies to analyze 
water development alternatives in North Central Montana. One study, 
involving the Tribe, evaluated options for developing a ``Tribal Only'' 
MR&I water system serving the Rocky Boys Reservation. The other 
investigation, conducted solely by BOR, was a regional feasibility 
study evaluating alternatives to meet the water needs of North Central 
Montana.
    The Chippewa-Cree Tribe strongly involved the Bureau of Reclamation 
in the ``Tribal Only'' MR&I study. This was because this federal agency 
questioned whether Tiber Reservoir should be the preferred source of 
water supply for the previously discussed North Central Montana 
Regional Water System. The Tribe subcontracted $155,000 of the study 
back to BOR to evaluate the other potential sources of supply and to 
complete environmental and economics work tasks. No preferred option to 
Tiber Reservoir was identified.
    The BOR regional feasibility study has not yet been completed but 
has identified no alternative firm water supply for the Rocky Boys 
Reservation or the surrounding communities in North Central Montana.
    It should also be observed that Article VII of the Chippewa Cree-
Montana Water Rights Compact entered into by my Tribe and the State of 
Montana on April 14, 1997 (Section 85-2-235 of the Montana Code 
Annotated) which was ratified by the United States via enactment of 
P.L. 106-163, contains language in Section A(3)(b) and (c) authorizing 
the Chippewa Cree Tribe to withdraw as a party to the Compact, ``if the 
municipal, rural and industrial water supply system identified as the 
preferred alternative by the feasibility study to serve the Rocky Boy's 
Reservation, or an equivalent water supply system as determined by the 
Tribe is not authorized or appropriated'' [within certain time frames]. 
We are aware that we were required to waive this right to withdraw via 
Section 5(a) of the Settlement Act (unless the entire compact should be 
declared void) but it is important for you to understand that when we 
negotiated our compact with the state of Montana, it was clearly our 
understanding that the construction of an MR&I system and the delivery 
of water to that system were critical components of that agreement.
    The BOR's previous statement expressed concern that a finding 
provision in H.R. 1946 (Section 2(a)(2)), stating that the U.S. has a 
trust responsibility to ensure an adequate supply of water to meet the 
needs of the reservation establishes some sort of newly created 
liability should they not deliver that water. The BOR doesn't seem to 
understand that the federal government, pursuant to its general trust 
responsibility to the Indian tribes of this country, already has the 
power to assist tribes in obtaining sufficient water for permanent 
tribal homelands, and it should do so. The Supreme Court has already 
made that quite clear and there was no intent in including that point 
to expand existing law, merely to reiterate it. If the BOR is 
particularly concerned with this provision, we are not averse to having 
it stricken from the bill.
    Finally, it is disconcerting to the Tribes that the BOR, which has 
been involved in constructing numerous municipal water systems and was 
continuously involved in the several studies, is challenging the 
preferred alternative without any acceptable alternative. Our neighbors 
and we are asking for the assistance of the United States in dealing 
with a serious region-wide problem while at the same time putting to 
beneficial use the 10,000 acre feet of water that has been reserved for 
us by the federal government in the Tiber Reservoir. We urge the 
enactment of S. 934.
    Again, we appreciate that our friends Max Baucus and Conrad Burns 
introduced this bill and we hope that you will now quickly mark it up 
and move it on to the floor of the Senate. Thank you again for the 
opportunity to testify in support of this important and necessary 
project. I would be pleased to answer any questions.

    The Chairman. Thank you very much.
    Mr. Raybould, why don't you go right ahead.

        STATEMENT OF JEFF RAYBOULD, CHAIRMAN, BOARD OF 
DIRECTORS, FREMONT-MADISON IRRIGATION DISTRICT, ST. ANTHONY, ID

    Mr. Raybould. Thank you, Mr. Chairman, members of the 
committee. My name is Jeff Raybould. I am the chairman of the 
Fremont-Madison Irrigation District, and I am here today in 
support of S. 2556.
    Fremont-Madison Irrigation District saw title transfer as 
an opportunity that we might be able to save a modest amount on 
our O&M expense, that we could provide additional water to our 
irrigators in our district, and also work to improve conditions 
on the river.
    Early on, Fremont-Madison decided the best way to go about 
this was to do this out in the open. Initially our chairman and 
the BOR area manager went before the Henry's Fork Watershed 
Council, which is the group of State agencies and private 
entities and organizations that work together to help better 
manage the Henry's Fork Watershed, and we laid out our plans to 
transfer all of our facilities that we have a contract with the 
Bureau for to the district. We had a lot of open discussion 
about how this might come about and how it might work in the 
future with the district having ownership of the facilities.
    The Henry's Fork Foundation, a local environmental group, 
stepped forward and said that they could see opportunities that 
would be available by the district having title, and wanted to 
work with us to achieve title of all of our facilities. They 
brought in Bruce Driver as an advisor. He is from the Land and 
Water Fund of the Rockies, and he worked with the Henry's Fork 
Foundation and Fremont-Madison Irrigation to try and devise a 
memorandum of agreement of how we would operate after title 
transfer.
    This process included regular reports back to the watershed 
council. We had a special meeting in June 2000 to discuss title 
transfer with all the participants of the watershed council, 
and the MOA that was being negotiated with the Henry's Fork 
Foundation. At the June meeting it became evident that even the 
Henry's Fork Foundation was going to have trouble supporting 
title transfer of the reservoirs, Island Park and Grassy Lake. 
The other organizations too had doubts about whether that would 
be a good thing to do at this time.
    But there wasn't any opposition to the transfer of the 
Cross Cut Diversion Dam, the Cross Cut Canal, the Teton Wells, 
and the associated water permits. Based on the feedback that we 
got working through this process with the watershed council and 
the Henry's Fork Foundation, we decided to move forward with a 
limited transfer bill that transfers only the Cross Cut 
Diversion Dam, the canal, and the wells.
    We have begun the process of doing the required NEPA work 
for this transfer and we continue to have outreach with the 
local stakeholders. Now the local stakeholders have raised some 
concerns about whether this would be a good thing to do, 
whether Fremont-Madison having the existing wells and possibly 
drilling additional wells might have impacts on the river. We 
believe that we can mitigate those impacts and that this title 
transfer should not be held up on the technicality that there 
potentially could be impact some day. We believe that the State 
of Idaho has the ability to regulate the water that might be 
withdrawn from the aquifer and see that no one is injured from 
any additional development that may occur.
    Mr. Chairman, committee members, Fremont-Madison has a long 
history of working with all the people in the area to do what's 
best for the river while providing a water supply to our 
irrigators. We put a lot of time and energy into this watershed 
council and we believe that we have made improvements to the 
environment as well as supplied water to our irrigators, and we 
pledge our continued support to do that, even after this title 
transfer process is completed, and would hope that this 
committee could recommend to the full committee that the bill 
have an opportunity to be looked at by the full Senate and 
voted on this session.
    I appreciate your time today and will be willing to answer 
any questions that you may have.
    [The prepared statement of Mr. Raybould follows:]

  Prepared Statement of Jeff Raybould, Chairman, Board of Directors, 
          Fremont-Madison Irrigation District, St. Anthony, ID

    Mr. Chairman, Members of the Subcommittee, I am Jeff Raybould, 
Chairman of the Board of Directors of the Fremont-Madison Irrigation 
District (FMID) in Idaho. I am here to testify in support of S. 2556.
    This legislation would require the Secretary of the Interior to 
convey certain facilities to our District pursuant to the Memorandum of 
Agreement with the Bureau of Reclamation. These facilities include: the 
Cross Cut Diversion Dam, the Cross Cut Canal and the Teton Exchange 
Wells.
    FMID was created under the laws of the State of Idaho in 1935 to 
enter into a repayment contract with the United States Bureau of 
Reclamation for the construction of Island Park Dam, Grassy Lake Dam 
and the Cross Cut Diversion Dam and Canal. The forty year repayment 
contract was paid out in 1979 by the spaceholders of FMID.
    FMID provides a supplemental water supply to approximately 1,500 
water users irrigating approximately 200,000 acres associated with the 
original Island Park and Grassy Lake projects as well as the failed 
Teton Dam project. Forty canal companies existed prior to the creation 
of FMID. The canal companies supply the natural flow water (primary 
water supply) to lands of their stockholders. They also conduct their 
own operation and maintenance. Most of the lands served by FMID are 
also lands of the canal companies. The FMID uses these canal companies 
to deliver storage water.
    In 1993, FMID and the Henry's Fork Foundation, a local 
environmental group, helped form the Henry's Fork Watershed Council 
which is a grassroots community forum that uses a non-adversial, 
consensus-based approach to problem solving and conflict resolution 
among citizens, scientists, and agencies with varied perspectives.
    FMID originally submitted a resolution to the Bureau of 
Reclamation, requesting transfer of title from Reclamation to FMID of 
Island Park Dam, Grassy Lake Dam, Cross Cut Dam and Canal and the Teton 
wells. FMID worked closely with the Henry's Fork Foundation to develop 
a consensus on how title for all these facilities could be transferred.
    In the course of this effort, the Watershed Council held a special 
meeting in June, 2000 to discuss the transfer of facilities. At this 
time, there was no opposition expressed to title transfer of the Cross 
Cut Dam and Canal and the Teton wells from any representative of the 
Watershed Council, including the Henry's Fork Foundation and the 
Greater Yellowstone Coalition. As a result of these consultative 
discussions, FMID has decided at this time to only go forward with 
seeking title to the Cross Cut Dam and Canal and the Teton wells.
    The Cross Cut Dam is located on Henry's Fork of the Snake River 
which diverts water into the Last Chance and Cross Cut Canals. It is a 
concrete gravity weir with a structural height of 17 feet and a total 
length of 457 feet. It was completed in 1938. The Cross Cut Canal 
begins at the Cross Cut Dam. The canal is approximately 7 miles long 
with a capacity of 600 cubic feet/second (cfs) at the head.
    The canal diverts storage water from the Henry's Fork near Chester 
and conveys it to the Teton River. In addition to conveying storage 
water to users on the Teton River, the canal also conveys natural flow 
water to some of the lands within the Fall River Irrigation Company 
system. A portion of the Cross Cut Canal was constructed through the 
already existing Fall River Canal. FMID has operated and maintained the 
canal since it was built. FMID and Fall River jointly employ a canal 
manager to address operation and maintenance needs.
    Five Teton Exchange Wells were constructed by the Bureau of 
Reclamation in the early 1970's as part of the Lower Teton Division. 
They were designed to provide groundwater in exchange for water storage 
in Teton Reservoir. Failure of the Teton Dam in June, 1976 made the 
constructed wells the only supplemental water source available to 
irrigate the lands affected by the Teton Dam failure.
    In 1977, FMID and the Bureau entered into a contract to allow the 
use of the wells as a backup water supply in drought years. This 
contract provides for the use of wells, pumps, motors and appurtenant 
facilities over a 25 year period.
    Water from the five wells is pumped into the lower Henry's Fork 
system to augment supplemental irrigation water supply for FMID in dry 
years. FMID pays for all operation, maintenance and replacement costs.
    FMID has conducted extensive outreach with local entities in 
response to the proposed title transfer and we will continue to do so 
as the process moves forward. We would like to address four concerns 
that have recently been raised by local environmentalists:

          (1) First, the only facilities authorized for transfer are 
        the Cross Cut Dam and Canal and the Teton Wells. Island Park 
        and Grassy Lake Dams are not included.
          (2) Second, it has been suggested that additional 
        conservation flows be designated for the Henry's Fork. This 
        should not be a condition for title transfer, but we will 
        continue to work with all local stakeholders to address this 
        issue.
          (3) Third, the Secretary is required to complete all actions 
        as required under the National Environmental Policy Act. At the 
        request of local environmental groups, the Bureau of 
        Reclamation has already initiated this process. The ultimate 
        level of review will be determined in accordance with this law.
          (4) Fourth, it has been suggested that the legislation be 
        delayed so that a comprehensive plan for drought management can 
        be developed. We are committed to working on drought management 
        with all local stakeholders. Legislative consideration of our 
        title transfer proposal should not be delayed. In fact, 
        enactment of this bill would free up resources for us to devote 
        to drought management strategies.

    This concludes my remarks. Thank you for allowing me to appear 
before your subcommittee today. I would be pleased to answer any 
questions you might have.

    The Chairman. Thank you very much.
    Mr. Carlson, why don't you go right ahead?

           STATEMENT OF PETER CARLSON, COORDINATOR, 
            SMALL RECLAMATION PROGRAM ACT COALITION

    Mr. Carlson. Mr. Chairman, members of the subcommittee, my 
name is Peter Carlson. I am president of the firm of Will & 
Carlson, Inc., a Washington, D.C. government relations firm 
specializing in natural resources issues.
    I would like to submit a letter of support for this 
legislation from the Association of California Water Agencies 
for the record as well.
    The Chairman. We will include that letter in the record.
    Mr. Carlson. Thank you. I also have with me today Roger 
Shimpaku from California and Tim Clark from Arizona, two of the 
leading experts on the implementation of small reclamation 
projects out west.
    I am appearing today as the coordinator of the coordinator 
of The Small Reclamation Coalition, which is made up of the 
National Urban Agriculture Council, the Western Coalition of 
Arid States, the Oregon Water Resources Congress, and the 
Eastern Municipal Water District in Southern California.
    At the outset let me state our strong support for S. 1882, 
the Small Reclamation Water Resources Act of 2001, and express 
our appreciation for your holding this hearing, and Senator 
Gordon Smith for introducing the legislation.
    The proposed amendments represent an 8-year effort to 
restructure the program and provide Western water users with 
new options for addressing their water related needs. Growth 
and the aging of the infrastructure out West are the driving 
forces for this legislation. There is presently not in place an 
active small reclamation loan program at the Bureau of 
Reclamation that is accepting proposals for projects. As a 
result, there is a project gap between the larger reclamation 
project that is typically before your subcommittee and the 
smaller programs that reclamation offers such as technical 
assistance. The Small Reclamation Water Resources Act of 2001 
will close that gap.
    The amendments contained in S. 1882 address these issues in 
the following manner: No longer requiring irrigation as a 
project purpose in the program will allow for the development 
of projects in the urban-rural crossover setting that are more 
economically and environmentally sound.
    Providing additional definition and expansion of the 
activities which can be undertaken through the program, 
especially for rehabilitation and betterment and in the area of 
water quality improvements will help address aging 
infrastructure problems as well as developing new opportunities 
to make better use of existing supplies without the need to 
create new water supply structures.
    Streamlining of the proposal process and the establishment 
of a definite schedule for the proposal processing will give 
water users greater program confidence and certainty.
    The establishing of a new smaller partnership program under 
title II of the SRPA amendments and the activities that can be 
carried out under the program will facilitate problem solving 
in a manner that gets the work done sooner before more problems 
develop.
    We see this as a $40 to $60 million a year program with 
respect to the Bureau of Reclamation's water and related 
resources budget. We appreciate the decision to increase the 
ceiling in the program from $359 million to $1.3 billion. This 
is one of the major changes in S. 1882 from legislation 
introduced in the past Congresses. S. 1882 calls for $900 
million to be made available to carry out projects under title 
I of the amendments, $300 million for title II, and $100 
million for title III.
    These numbers are not without foundation. When the program 
was suspended in 1995, there were notices of intent for 
projects totaling approximately $450 million. Approximately 
$170 million of this total was for Native American projects. We 
conducted an electronic survey of 1,000 water users in the West 
and received responses to our survey from 12 of the 17 States 
indicating a strong interest in using both title II and title I 
of the proposed amendments, further justifying the need for a 
ceiling increase.
    We have also received responses to the idea contained in S. 
1882 of setting aside up to 20 percent of the proposed ceiling 
in the program for Indian tribes and economically disadvantaged 
communities, an approach the water community strongly supports. 
The continuation of the Bureau of Reclamation small reclamation 
loan program with the changes made by S. 1882 is the most 
important and appropriate course to take at this time. There is 
strong interest out there and a belief that the small 
reclamation loan program is the best vehicle to accomplish the 
work for helping address the rural-urban Indian population and 
water and environmental needs in the west.
    Thank you, Mr. Chairman.
    [The prepared statement of Mr. Carlson follows:]

           Prepared Statement of Peter Carlson, Coordinator, 
                Small Reclamation Program Act Coalition

    Mr. Chairman, Members of the Subcommittee, my name is Peter 
Carlson, I am President of the firm Will & Carlson, Inc., a Washington, 
D.C. governmental relations firm specializing in natural resource 
issues. I am appearing today as the coordinator of the Small 
Reclamation Program Act Coalition which is made up of the National 
Urban Agriculture Council (NUAC), the Western Coalition of Arid States 
(WESTCAS), the Oregon Water Resources Congress (OWRC) and the Eastern 
Municipal Water District in Southern California (EMWD).
    At the outset, let me state our strong support for S. 1882, the 
Small Reclamation Water Resources Act of 2001 and express our 
appreciation for your holding this hearing and Senator Gordon Smith for 
introducing the legislation. The proposed amendments represent an eight 
year effort to restructure the program and provide western water users 
with new options for addressing their water resource related needs.
    The Small Reclamation Program Act was last amended in 1986, and the 
amendments were appropriate for that time. The changes proposed by S. 
1882 build on what we, the water users, have learned since that time 
and will make this an even better program from an environmental, 
business and socio-economic standpoint.
    According to the Western Water Policy Review Commission report from 
1998 ``Once the outpost of a young nation, today's West is home to 
nearly one-third of the American population. The region has experienced 
rapid population growth in recent years: western states grew by about 
32 percent in the past 25 years, compared with a 19-percent rate in the 
rest of the nation. By the year 2025, the West will add another 28 
million residents.''
    A more recent report from the University of Colorado's Center of 
the America West, of 11 Western states (California, New Mexico, 
Wyoming, Washington, Idaho, Utah, Arizona, Oregon, Colorado, Montana, 
Nevada), indicated that the 2000 census counted 61.4 million people in 
the Western states--a 21 percent increase from 1990. By 2050, 109 
million people will live in the Western States, the study estimates.
    This Westward growth is why S. 1882, is so vitally important. There 
is presently not in place an active Small Reclamation Loan Program at 
the Bureau of Reclamation that is accepting proposals for projects. 
From our perspective, the proposed amendments would bring a number of 
important changes to the existing program that would help address the 
issues related to growth in the West. This decision, amending the Small 
Reclamation Loan Program, is an important step in investing in the West 
and putting in place a revitalized program that western water users can 
use to address the various needs associated with growth, whether they 
be water supply, water conservation, water quality, environmental or 
social purposes. There is currently a program gap between the larger 
Reclamation project that is typically before your Subcommittee and the 
smaller programs that Reclamation offers, such as technical assistance. 
The Small Reclamation Water Resources Act of 2001 will close that gap.
    The amendments contained in S. 1882 address these issues in the 
following manner:

          1. No longer requiring irrigation as a project purpose in the 
        program will allow for the development of projects in the 
        urban-rural crossover setting that are more economically and 
        environmentally sound. This is precisely the area of greatest 
        need for support in development of small projects.
          2. Providing additional definition and expansion of the 
        activities which can be undertaken through the program, 
        especially for rehabilitation and betterment and in the area of 
        water quality improvements. This will help address aging 
        infrastructure problems as well as developing new opportunities 
        to make better use of existing supplies, without the need to 
        create new water supply structures.
          3. The streamlining of the proposal process, and the 
        establishment of a definite schedule for proposal processing 
        will give water users greater program confidence and certainty. 
        Proposals will no longer languish in the bowels of the 
        bureaucracy only to then have to wait years for an answer on 
        whether there is a Federal interest in the proposed work.
          4. The establishing of a new, smaller partnership program 
        under Title II of the SRPA amendments, and the activities that 
        can be carried out under the program. This will facilitate 
        problem solving in a manner that gets the work done sooner 
        before more problems develop, through the work being carried 
        out by the project sponsor within 18 months and a shortened 
        repayment period.
          5. The reduction of the repayment period for Title I projects 
        from 40 years to 25 years will also bring the program in line 
        with current business practices in the private sector and 
        lessen the financial exposure to the Federal government.
          6. Connecting the proposed work to organizations that have 
        legal authority and responsibility for such work on their 
        projects, and making sure that work is consistent with 
        applicable State water law will keep the program focused and 
        more accountable.

    As part of the discussions with the organizations I represent, 
which helped in the development of the ideas embodied in S. 1882, some 
have questioned whether the Bureau's Budget would be able to 
accommodate this program. Western water user organizations have been 
working successfully on the Energy and Water Appropriations bill 
through our ``Invest In the West'' campaign to increase the allocation 
for the Bureau of Reclamation's Water and Related Resources program. 
Given the construction schedules associated with the program and the 
decision-making process that is built into the legislation, we see this 
as a $40 to $60 million a year program. We believe the Bureau of 
Reclamation should be able to accommodate such a level, given the 
changes to the program proposed by these amendments.
    We appreciate the decision to increase the cost-ceiling in the 
program from $359 million to $1.3 billion in order to accommodate the 
interest out in the West for the program. This is one of the major 
changes in S. 1882 from legislation introduced in past. S. 1882 calls 
for $900 million to be made available to carry out projects under Title 
I of the amendments, $300 million for Title II and $100 million for 
Title III. These numbers are not without foundation.
    When the program was suspended in 1995 there were Notices of Intent 
for projects totaling approximately $450 million. Approximately $170 
million of this total was for Native American projects. There were 
another ten projects that were in or about to enter the construction 
phase, the last three of which are being completed by this years 
appropriations.
    At the end of the 106th Congress we conducted an electronic survey, 
based on similar legislation in the last Congress, to assess the 
interest in the programs that would be developed under this 
legislation. Historically 15 of the 17 Western states have used this 
program. We received responses to our survey from water users in 12 of 
the 17 states indicating a strong interest in using both Title I and 
Title II of the proposed amendments.
    Since that time I have also received responses to the idea 
contained in S. 1882 of setting aside up to 20% of the proposed ceiling 
in the program for Indian Tribes and economically disadvantaged 
communities, an approach the water community strongly supports. These 
amendments also open the program up to Hawaii, Alaska and the Insular 
areas so their water needs can be addressed as well, an idea that we 
also support.
    Another 1998 recommendation of the Western Water Policy Review 
Commission was ``Given the declining federal budgets, innovative 
sources of funding and investment, including public and private 
partnerships, must be found for the management and restoration of 
western rivers.''
    Part of the reason for including a section in this bill on 
guaranteed loans is to explore the initiation of a new loan guarantee 
section under the Act. The Federal Government has approximately forty 
guaranteed loan programs listed in the Federal Budget. The Loan 
Guarantee section of these amendments is to open the door for a new, 
innovative approach to assist in funding projects. We believe that 
making available such a new financial tool for the Bureau to explore 
and make use of (loan guarantees) could benefit the water users in the 
West by having projects developed in a more timely manner while we all 
continue to work together to increase the financial resources for the 
Bureau of Reclamation for other projects in the program. As we stated 
earlier, we don't envision this program being a heavy financial burden 
on the Bureau of Reclamation's Water and Related Resources budget, but 
we are willing to work with the Bureau to explore new ways, such as 
this proposal, to see if there are financial innovations that work in 
meeting our needs.
    I would like to address the issue of whether the Bureau of 
Reclamation should or shouldn't be in the loan business. Why is it that 
almost every Federal agency has a loan program, to assist in carrying 
out their activities, yet in past comments on the program the Bureau of 
Reclamation claims ``the current loan process (at Reclamation) suffers 
from a lack of trained credit officers to monitor loans as well as 
assist in determining economic feasibility, repayment terms, maturity 
dates, and interest rates . . . . Reclamation would continue to be in 
the business of developing repayment contracts and engaging in loan 
collection activities, two tasks for which the private sector is better 
suited than the Federal Government.'' The former Administration made 
great claims about Reinventing Government. Why can't Reclamation learn 
from the best of what other Federal agencies do with their loan 
programs and in turn benefit the public from a reinvention in their 
loan program? This is part of the reason why S. 1882 is so important in 
terms of the prescriptiveness of the process, decision making time 
frames and the need to rewrite the guidelines for the new program
    Some would like Reclamation just to be in the grant business. We 
don't believe that would be a good idea. From FY91 to FY99 Reclamation 
provided approximately 4,600 grants worth about $750 million. Unless 
you tie the grants down like S. 1882 would do through the amendments to 
the program, I believe that a grant only program would be a recipe for 
waste and abuse. If the Bureau has such experience with grants, which I 
have been told are more burdensome to administer, and have so few 
loans, it would seem like they can figure out how to make a loan 
program work better from an administrative standpoint.

                               CONCLUSION

    The continuation of the Bureau of Reclamation's Small Reclamation 
Loan Program, with the changes made by S. 1882 is the most important 
and appropriate course to take at this time. Based on the details in 
the Western Water Policy Review Commission report, our survey and 
meetings and conversations with water users in the West, there is a 
strong interest out there for a program that can help address the needs 
of the West, and a belief that the Small Reclamation Loan Program is 
the best vehicle to accomplish the work. Investing in the West through 
the proposed amendments to the program will be the best step forward 
into the 21st Century for helping the rural, urban, Indian population 
and the water and environmental resources of the West.

    The Chairman. Thank you very much, and let me call on 
Senator Craig for his questions at this point.
    Senator Craig. Mr. Chairman, thank you very much. 
Gentlemen, thank you all for your testimony.
    Jeff, let me address a couple of questions to you, and I 
think I will mainly focus on something that we are both aware 
of that I think you have addressed in part, but it's an 
editorial that appeared in an Idaho newspaper about this 
legislation. This editorial appeared to be written directly 
from certain environmental groups talking points more so than 
from the whole value of what we're attempting to do here, and I 
believe it contained many inaccuracies such as saying that the 
Idaho congressional delegation rejects requests from 
environmentalists to testify on the bill.
    As I understand it, there was an environmental group which 
testified about the bill during the hearing for the House of 
Representatives had on similar legislation, and my office 
frankly has never heard from any of those groups that has made 
request for the committee, or they would be seated there with 
you today.
    Let me quote from the editorial and see if you have a 
response. It says: ``This legislation could be interpreted to 
in the future include the Island Park and Grassy Lake 
Reservoirs.'' Do you read that or is it the understanding of 
the irrigation districts that the intent of this is to acquire 
and/or transfer within this legislation that, or set a 
precedent for that purpose?
    Mr. Raybould. Mr. Chairman, Senator Craig, that is not our 
intent nor is that the way we read that section of the 
legislation. However, if a clarification can be made, and I 
believe that they did make a clarification over on the House 
side by relisting the exact facilities that were to be 
transferred, we would be amenable to that. That wouldn't be a 
problem for us at all.
    Senator Craig. Okay. It says that only five of the 45 wells 
in the Teton Basin District are now operable and those 
additional wells--as those additional wells are brought on 
lines and possibly expanded, some fear they will diminish flows 
in the Lower Henry's Fork and the Teton River. They also ask 
how operating more wells will affect people using surface and 
ground water for irrigation areas. You partially addressed that 
by the role that the State plays in monitoring and/or the 
issuance of permits for drilling and water rights within those 
areas. Would you care to address that any further?
    Mr. Raybould. Mr. Chairman, Senator Craig, the opportunity 
to develop more ground water with the existing State permit is 
there. However, before we can do that, we're going to have to 
go to the Idaho Department of Water Resources and secure 
drilling permits for the number of wells that we want to drill. 
There will be an opportunity for anyone to come to the 
Department at that time and protest whether those drilling 
permits are issued or not, and explain why. And we will have 
the opportunity to show whether or not we believe there will be 
injury, if there is any injury to occur, how we would mitigate 
for that injury, and it's our intention to put forth a 
mitigation plan that would take care of any potential impacts 
to ground water or river flows prior to any further development 
of that permit.
    Senator Craig. Lastly, Mr. Chairman, it said: ``Land never 
intended to be irrigated in the Fremont-Madison District could 
be conceivably covered in this legislation.'' I didn't even 
understand that comment in general, but your reaction to it?
    Mr. Raybould. Mr. Chairman, Senator Craig, that's an 
inaccurate statement. There has been some confusion over the 
years about what the exact boundaries of the Fremont-Madison 
Irrigation District are. A substantial amount of land was 
annexed into the district on the anticipation of the completion 
of the construction of the Teton Dam. As you may or may not be 
aware, that dam failed on June 5, 1976, and was not 
reconstructed. Those lands were already annexed into the 
district and have been provided a supplemental water supply by 
these wells that we're talking about, as well as the existing 
supply that we have in Island Park and Grassy Lake Reservoirs, 
and we are not intending to bring any more land into the 
district, or water any land that the Bureau of Reclamation 
isn't aware was either part of the original boundaries of the 
district or this annexation which took place with Teton.
    Senator Craig. Thank you for those questions. Let me 
comment in closing for the record, Mr. Chairman, that as I have 
been a part of transferring irrigation districts to title once 
they have been paid out, as is the case here, the thing that is 
most unique about Fremont-Madison is that they have looked very 
closely at all of these other transfers, looked at their 
problems, and from the very beginning, they chose a very open 
public process. By incorporating in that the Henry's Fork group 
and allowing full public participation in a very transparent 
process, so my compliment to them for the way they worked this 
issue.
    We all know the importance of water in the West. They 
recognize that. They also recognize the role that it plays for 
things other than irrigation, and I think that's why they moved 
in such an open and public way to ultimately bring us to this 
legislation. I want to thank Jeff and his organization for that 
approach.
    Thank you, Mr. Chairman.
    The Chairman. Thank you. Before I call on Senator Burns, 
let me just ask one question, if I could, Mr. Raybould. We do 
have this written statement that has been submitted for the 
record and in fact we have a series of statements here. We have 
six different statements of written testimony to be submitted, 
some related to this legislation, some to other bills being 
considered at this hearing.
    This is from the Henry's Fork Foundation and the conclusion 
is, it says, ``The HFF would like to request that the current 
legislative proposal be delayed while the various stakeholder 
groups are convened to see if there might be an alternative 
that meets everyone's needs.''
    Now you have undoubtedly seen that testimony. Could you 
respond to that suggestion?
    Mr. Raybould. I would be happy to, Mr. Chairman. We have 
been working on this for over 4 years and we believe that we 
have come to a point where we have resolved as many of the 
differences as we can. We don't think there are any significant 
issues out there left to be dealt with. This is a transfer of a 
diversion dam, a canal and some wells and we would like to see 
it proceed.
    We know there's other issues out there. We're in a drought. 
There is not enough water to go around. As I said in my 
statement, we are committed to work with the Henry's Fork 
Foundation and all the other stakeholders to work through these 
issues and do the best job we can with the limited flexibility 
that we have.
    The Chairman. Thank you very much.
    Senator Burns.
    Senator Burns. Thank you very much, Mr. Chairman. I will 
just--I want to first of all thank Dan Keil, Bruce Sunchild, 
and the delegation from Montana who've come back to testify on 
behalf of the legislation to complete the water distribution 
system up in north central Montana.
    You know as we look at this, this is not a new idea and 
it's not a new project. We're not starting from ground level. 
We already have projects established there. Right now we are 
just looking for a system to manufacture more water and 
distribute it more efficiently. But the State has made the 
commitment to this project and so have the local communities.
    And I want to personally thank Dan Keil for coming back 
because Dan has been, ever since I've been around, he has been 
dealing with rural water districts, 30 years experience on it, 
and Dan knows that you just cannot take on a project like this 
unless it has strong local support and people who are willing 
to invest not only their time and talent, but their resources 
into making it work. So I appreciate that.
    But we're just building on a system that is already there, 
and it is not a new idea, not a novel idea, so we just 
appreciate your help and support on this. There are some minor 
things we will have to work out with the BOR and I think we can 
do that, working together with the communities and the 
delegation, we can do that now.
    As far as getting it passed this year, it looks like the 
platter may be kind of full when we come back, but who knows. 
We may see the floodgates open up and all kinds of positive 
things happen. But Bruce and Dan, I appreciate you making this 
trip today and this testimony, and we will continue to work 
with you as this project moves forward.
    Thank you, Mr. Chairman, and I appreciate scheduling the 
hearing, and I think it will be one of those areas we might be 
ready for a mark when you reconvene the full committee after we 
come back and after the August break, and we will work pretty 
hard in August trying to work out the kinks in this thing to 
where it's acceptable to all parties, and I thank you for that.
    The Chairman. Thank you very much. Let me thank all these 
witnesses and go ahead and dismiss this panel, and call the 
final panel, made up of the Honorable Martin Chavez, the mayor 
of the city of Albuquerque, and Wayne Halbert, who is the 
manager of the Harlingen Irrigation District.
    I failed to recognize also that Dr. Peter Scholle, the 
director and State geologist for New Mexico, with our New 
Mexico Institute of Mining and Technology, is also here. Thank 
you very much for coming. And Dr. Lee Allison is accompanying 
him. He is with the Kansas Geological Survey, University of 
Kansas.
    Thank you all very much for being here. I think that the 
testimony is divided on different subjects here. Let me start 
on the left with Mayor Chavez to talk about his concern, 
particularly about S. 2696, which I believe is the bill that 
you are mainly focused on today. Thank you for coming.

             STATEMENT OF MARTIN J. CHAVEZ, MAYOR, 
                        ALBUQUERQUE, NM

    Mr. Chavez. Thank you very much, Senator. Very briefly, and 
my written comments I believe are part of the record, and I 
would like to deviate somewhat on those based on Commissioner 
Keys' testimony because I am frankly a little bit astonished 
right now. I know him by reputation to be an outstanding 
individual but I think there is a real problem somewhere at the 
staff level of what the facts are as they're getting to the 
Commissioner.
    By way of background of course, Tingley Beach was the place 
where all of Albuquerque went in the 1940's to swim, to 
recreate, until everyone started getting sick because it was 
improperly lined. It was shut down. It is now used primarily 
for fishing and the goal for the city of Albuquerque and this 
wonderful piece of property that runs through the heart of the 
city has been to renovate it, use it once again. It has been 
the object of considerable capital expenditure by the city of 
Albuquerque.
    In 1997, we acquired it from the Middle Rio Grande 
Conservancy District for $3.8 million, a very good currency. At 
that time the Bureau of Reclamation specifically, on December 
15, 1997, approved the sale by the conservancy to the city of 
Albuquerque. And then subsequent thereto, we had the silvery 
minnow litigation, at which time the Bureau of Reclamation 
reversed its position and said that no, Conservancy doesn't 
have title, we have title to all of the water works up and down 
the Rio Grande as pertain to a conservancy district.
    We kind of got caught up in that litigation, Senator, and 
what was disturbing to me--and I think if we can meet and get 
staff talking to staff properly, and elected officials to 
elected and appointed officials properly, we can get this 
worked out--in March--and these parcels have nothing to do with 
that litigation, they have no impact on the litigation 
whatsoever. In March of this year, the area manager from the 
Bureau of Reclamation came to my office and said we agree this 
has nothing to do with the litigation, go ahead and ask your 
delegation to introduce legislation to clear the title.
    And so we were operating only at the request of the Bureau, 
or the suggestion of the Bureau of Reclamation, so I'm 
astonished that they now stand in opposition. I think there is 
just a disconnect somehow in the process and that's what I want 
to work with you and the subcommittee to get resolved, but 
that's where we are at.
    There is a contest over title. If the conservancy owes it, 
they have already conveyed it to us for $3.8 million. If the 
Bureau of Reclamation owns it, and my personal legal opinion is 
that their claim isn't too strong, but even if they do, they 
have already expressed willingness to convey it to us anyway, 
so we're left out in the cold wondering if we're going to have 
to wait 10 years for that litigation to wind its way to the 
Supreme Court, which it certainly will.
    [The prepared statement of Mr. Chavez follows:]

     Prepared Statement of Martin J. Chavez, Mayor, Albuquerque, NM

    Thank you for inviting me to testify on Senate Bill 2696. The City 
of Albuquerque is the victim of a fight between the Federal government 
and the Middle Rio Grande Conservancy District over water. The fight 
has jeopardized the development of Albuquerque's Rio Grande Biological 
Park.
    In 1997, the City paid the Conservancy District $3,875,000.00 for 
Tingley Beach and San Gabriel Park in order to expand the Rio Grande 
Biological Park. The Federal government now claims that the City does 
not own the property. (United States District Court for the District of 
New Mexico Cause No. CIV 99-1320 JP/KBM-ACE, entitled Rio Grande 
Silvery Minnow, et al. v. Eluid L. Martinez, et al.) The Federal 
government claims that in1953, in an unrecorded ``Grant of Easement'', 
the Conservancy District conveyed fee title to all of its property to 
the Federal government. If the claim is valid, the Conservancy District 
did not own Tingley Beach and San Gabriel Park in 1997, and under 
Reclamation law, title to the property can be conveyed to the City only 
by an act of Congress.
    The City plans to invest $15,300,000.00 of City funds to improve 
and develop Tingley Beach and San Gabriel Park for the Rio Grande 
Biological Park. The City cannot, however, risk the investment of 
public funds to improve property it may not own. Until the cloud on the 
City's title to the property has been removed, the City cannot improve 
Tingley Beach and San Gabriel Park and complete the Rio Grande 
Biological Park.
    Because of their location and characteristics, Tingley Beach and 
San Gabriel Park are unique properties for the development of the Rio 
Grande Biological Park. Monetary damages or the purchase of other 
property will not permit the City to develop the unique, high quality 
park that it can develop by improving Tingley Beach and San Gabriel 
Park.
    The Conservancy District leased Tingley Beach to the City in 1931 
and San Gabriel Park in 1963. The City has been in possession of the 
property since that time. The Conservancy District has not used the 
property and there are no reclamation works on the property. The Bureau 
of Reclamation recently determined that Tingley Beach and San Gabriel 
Park is surplus to the reclamation project and that the Bureau of 
Reclamation does not want the property.
    The enactment of Senate Bill 2696 will remove the cloud on the 
City's title to Tingley Beach and San Gabriel Park and permit the City 
to complete the development of the Rio Grande Biological Park.

                       RIO GRANDE BIOLOGICAL PARK

    The Rio Grande Biological Park lies along the east side of the Rio 
Grande River north and south of Central Avenue, which is historic Route 
66 through Albuquerque. It is an educational, research and recreational 
treasure, that provides a unique and vital view of New Mexico and our 
biologically diverse world, not only for the residents and visitors to 
Albuquerque, but for the State of New Mexico. When completed, the Rio 
Grande Biological Park will instill in the public a recognition of the 
need for water conservation, habitat conservation, the interdependence 
of life and environmental stability that is essential to our future as 
a community, state and nation; support and enhance environmental 
education, awareness and stewardship; and provide a recreational, 
cultural and educational facility and resource that uniquely portrays 
the cultural, environmental and ecological aspects of the Rio Grande 
River.
    The Rio Grande Biological Park occupies 170 acres and consists of 
the Rio Grande Zoo, Tingley Aquatic Park, and the Albuquerque Aquarium 
and Botanic Garden. Tingley Aquatic Park will be constructed on the 
site of Tingley Beach and the Botanic Garden will be expanded into San 
Gabriel Park.
    Tingley Beach consists of 35.3 acres and is located south of 
Central Avenue between the Rio Grande Zoo and the Albuquerque Aquarium 
and Botanic Garden. It was created when Mayor Clyde Tingley, who later 
became Governor of New Mexico, asked the Middle Rio Grande Conservancy 
District to lease burrow pits that had been dug to construct a levy to 
the City for a park and swimming beach.
    The Albuquerque Aquarium and Botanic Garden is located north of 
Central Avenue across from Tingley Beach. San Gabriel Park consists of 
42.7 acres and is located northwest of and adjacent to the Botanic 
Garden. In the late 1950's, the Conservancy District moved the 
Albuquerque Drain west and isolated a portion of the Rio Grande River 
channel. The Conservancy District leased this property to the City for 
park and recreation purposes.

                          TINGLEY AQUATIC PARK

    Because it lies between the Rio Grande Zoo and the Albuquerque 
Aquarium and Botanic Garden, Tingley Aquatic Park is a key transitional 
and connecting element in the Rio Grande Biological Park system that is 
accessible by trail, road and eventually by a railroad.
    Tingley Aquatic Park will be developed for water-oriented 
recreational use, education and environmental research and planning. 
Improvements will consist of five lakes for boating, deep-water 
fishing, children's fishing and model boating. One lake will be an 
observation lake. The City will also construct a swimming pool, picnic 
areas and facilities, and a building for group meetings and gatherings 
on the property.
    As part of this project, the City will remove all non-native plants 
from the bosque adjacent to Tingley Beach and re-establish and maintain 
the Rio Grande cottonwood as the dominate canopy species. The City will 
also create additional wetlands and marshes that were historically 
abundant in the Rio Grande Valley.
    The United States Corps of Engineers has plans to assist the City 
in the reclamation and construction of the lakes. The Corps of 
Engineers also plans, in association with the Rio Grande Zoo, to 
construct a bosque exhibit on property adjacent to Tingley Beach that 
will illustrate a succession sequence from an oxbow lake, to a cattail 
marsh, to a saltgrass meadow, to a bosque.
    The City's and the Corps of Engineers' projects at Tingley Beach 
will improve wildlife habitat along the Rio Grande River at Tingley 
Aquatic Park.
    Tingley Aquatic Park is also a part of the Rio Grande Valley State 
Park which was authorized by the New Mexico Legislature in 1983 to 
preserve, protect and maintain the natural scenic beauty of the Rio 
Grande River and its immediate riverine corridor. The City is the 
operator of the Rio Grande Valley State Park.

                            SAN GABRIEL PARK

    The Botanic Garden was created to reflect the region's 
environmental and cultural heritage. The expansion of the Botanic 
Garden into San Gabriel Park will carry through with this theme. The 
improvements will include seventeen gardens, including a Japanese Tea 
Garden, conservatories, a tree nursery, botanic library, herbarium, 
office and meeting rooms, and support facilities.
    The expansion at San Gabriel Park will include ethnobotanic 
exhibits which will offer the only place in the state to learn about 
the historic use of plants for fiber, food and medicine. An antique 
apple orchard will feature apple trees that were brought to the area by 
Hispanic settlers. The Zuni Waffle Garden will illustrate ancient 
Anazazi Indian methods for conserving water and will feature ancient 
plants cultivated by the Anazazi. The City has already constructed the 
El Jardin de la Curandera exhibit at San Gabriel Park, honoring 400 
years of Hispana presence in New Mexico and exploring herbal medicines 
used within the contexts of the practices of curanderismo.
    A Period Farm will illustrate farming techniques and practices 
during the period from 1920 through 1940 which was the period of 
Albuquerque's greatest growth and transformation into an urban center.
    The Trial Garden will feature new breeds of plants and the Camino 
de Colores will be a highway of flowers.
    An exhibit entitled El Canoncito will provide the backdrop for the 
Conifer and Mountain Meadows exhibit and will illustrate the varied 
microclimates found in the mountain environments of New Mexico.
    San Gabriel Park is in the cottonwood bosque (riparian forest) of 
the Rio Grande River and offers an unparalleled opportunity to showcase 
this distinctive natural environment. The expansion of the Botanic 
Garden into San Gabriel Park will include a Cottonwood Gallery of the 
magnificent existing stands of cottonwoods that remain to provide a 
living example of the native bosque.
    The City, in cooperation with the State of New Mexico and the 
United States Bureau of Reclamation, will construct, at San Gabriel 
Park, the Rio Grande Silvery Minnow Rearing and Breeding Facility for 
breeding and conditioning the endangered Rio Grande Silvery Minnow for 
release into the Rio Grande River. The City recently awarded a contract 
for the construction of this facility.

                       RIO GRANDE BOSQUE RAILROAD

    The master plan for the Rio Grande Biological Park includes the 
construction of the three-quarter scale Rio Grande Bosque Railroad 
which will provide a transportation link that covers the four miles of 
the Rio Grande Biological Park between the Aquarium and Botanic Garden 
in the north, through Tingley Aquatic Park, to the Rio Grande Zoo in 
the south. A depot and turnaround will be constructed at San Gabriel 
Park and a depot will be constructed at Tingley Aquatic Park. The Rio 
Grande Bosque Railroad will also connect the national Hispanic Cultural 
Center south of the Rio Grande Zoo with the Rio Grande Biological Park.
    The enactment of Senate Bill 2696 will make the City's vision for a 
unique biological park possible. I urge your support of Senate Bill 
2696.

    The Chairman. Before we go to the other witnesses, let me 
just very quickly break with our usual procedure here and just 
ask a question or two about this, since I don't think any of 
the other witnesses are going to testify on this particular 
bill.
    Can you elaborate a little more on what the city's plans 
are for this biological park and why the delay in getting this 
title cleared would be a real problem for the city?
    Mr. Chavez. Yes, certainly, Senator. We have already spent 
close to $4 million on Tingley, acquiring the property. We have 
title insurance to cover us but I don't want the insurance, I 
want the property. We are poised to spend approximately $15 
million in the complete renovation, with beautiful paddle 
areas, swimming areas, remote control boats. It's going to be a 
gorgeous--it will restore it to what it was if not better than 
in the 1940's.
    But I am reluctant to authorize the expenditure of 
municipal taxpayer money if we don't have title to the 
property, and the bureau's offer of a license doesn't give us 
any relief. What they're offering us is a 25-year license fully 
revokable at their whim, and that of course is not the basis 
upon which a prudent mayor would spend millions of dollars.
    The Chairman. Thank you very much. Let me just say, we want 
to keep working with you and try to resolve this breakdown in 
communication which apparently exists with the Bureau of 
Reclamation. But, I thank you very much for testifying, and we 
will continue to work with you on that. You can remain for the 
remainder of the hearing or proceed with your next obligation, 
whatever your choice is.
    Mr. Chavez. I do have some other goals for Albuquerque, and 
I'm going to go try to shake another branch of the Federal 
money tree across town.
    The Chairman. I knew you had that in mind. So Mr. Halbert, 
why don't you go ahead with your testimony.

         STATEMENT OF WAYNE HALBERT, GENERAL MANAGER, 
HARLINGEN IRRIGATION DISTRICT, CAMERON COUNTY #1, HARLINGEN, TX

    Mr. Halbert. Thank you, Mr. Chairman, committee members, 
and staff. Thank you for the opportunity to testify before you 
today for the communities and water districts along the lower 
Texas border. My name is Wayne Halbert, general manager of the 
Harlingen Irrigation District, and I represent irrigation 
districts that supply irrigation water for a million acres or 
over a million acres of farmland, and raw water to 
municipalities for over a million and a half people.
    My testimony is in support of S. 1577 and H.R. 2990, which 
amends the Lower Rio Grande Valley Resources Conservation 
Improvement Act of 2000.
    For the past several years the border region has been 
deeply involved in integrated resource management studies to 
determine a direction for our communities to make in water 
resource management. These studies have given us really stark 
revelations as to unprecedented predictions and population 
growth, and needs for the water resources over the next few 
years.
    Rio Grande Valley water districts have partnered with the 
Bureau of Reclamation on projects since the early 1950's, and 
many developed projects remain undone due to the lack of 
funding available to meet the needs of these districts. 
Districts since those fundings ran out in the 1960's have 
systematically chipped away at these projects within their 
budget restraints. However, various changes in the water 
resource conditions have made this a slow process, 
unacceptable, has made this slow process unacceptable and has 
placed the agricultural and municipal supply needs in peril.
    Dryer than normal conditions, drought situations, explosive 
developments in Mexico and the United States along the border 
with Mexico, Mexico's violation of the terms of the 1944 treaty 
which many of you have seen in the newspapers. Population 
explosion in the Rio Grande Valley has escalated massive 
problems within our water resource situation.
    And if our population problems aren't enough, Mexico's 
along the borders are many times worse, and they draw from the 
same resource we're talking about. All of these pressures have 
turned up the heat on water resources on the Rio Grande, and 
there are many valid reasons and concerns and frustrations over 
the various issues that we could think about and talk about 
that desperately need your help.
    But really what we're here for today is to offer you a 
blueprint for at least some of the solutions to our problems. 
The comprehensive water recourse plans sought solutions that 
would provide a balance to the fragile economy and environment 
of the border region. Our goal was to find enough firm yield 
water to provide for the municipal, industrial, environmental 
and agricultural needs of the region and to dovetail those 
plans into the expected growth needs of the valley.
    With 85 percent of the water being used by agriculture, 
obviously our plans showed that the greatest challenges of 
conservation and the greatest opportunities of conservation 
would be in irrigation projects. S. 1577/H.R. 2990 provides the 
authorization for the Bureau of Reclamation to implement the 
programs and projects that surfaced as the most cost effective 
way to provide for the water resource needs of the Texas border 
region.
    Our irrigation systems were built in the early 1900's, 
1905, and they are the life blood of the municipalities as well 
as agriculture. All of the municipalities along the Rio Grande 
border depend on the irrigation systems to deliver their water 
to them for treatment. The projects outlined in this 
legislation would more than double the water available for 
municipal and industrial use without collapsing the 
agricultural economy. The agricultural economy is extremely 
important to our region.
    A couple of years ago we testified that an undependable 
water supply could do irreparable damage and would push our 
local unemployment figures out of sight. We now have a report 
from Texas A&M that estimates as many as 30,000 jobs have been 
lost over the past few years directly related just to the 
Mexico treaty issue alone. The importance of legislation has 
been accelerated by all of the conditions that we have stated.
    We recognize that we may have to live and grow on less 
water than we have been accustomed to. We continue to lose 
farms and businesses that have been a part of the Rio Grande 
Valley heritage for over a hundred years, mostly because water 
resource demands of the past 7 years have been inadequate.
    The cost of water to the general public is on the rise and 
will continue to do so as the scarcity of the resource 
manifests itself. This legislation allows us to turn these 
tragic losses around and provide new life and new hope to the 
Rio Grande border region. Districts had planned these needed 
projects for years and anticipated accomplishing them over the 
next 20 years or so, but the testimony that we have given today 
has shown you that we do not have that luxury.
    Every few acre feet of water not conserved is another 
family farm gone, another few jobs lost, another business who 
has had to close their doors. Our future is definitely in your 
hands, and we appreciate your support for S. 1577/H.R. 2990.
    Thank you for your attention.
    [The prepared statement of Mr. Halbert follows:]

         Prepared Statement of Wayne Halbert, General Manager, 
    Harlingen Irrigation District, Cameron County #1, Harlingen, TX

    Mr. Chairman, Committee Members and staff, thank you for the 
opportunity to testify before you today on behalf of the communities 
and water districts along the Texas Border. I am Wayne Halbert, General 
Manager of the Harlingen Irrigation District and represent irrigation 
districts that supply irrigation water to over a million acres of 
farmland and raw water to municipalities for over 1.5 million people. 
Our testimony is in support of S. 1577, which amends the Lower Rio 
Grande Valley Resources Conservation and Improvement Act of 2000, to 
authorize additional projects under that Act, and for other purposes.
    For the past several years the Border Region has been deeply 
involved in Integrated Resource Management studies to determine a 
direction for our communities to take in water resource management. The 
State of Texas gave direction to these studies in 1997 with legislation 
that required even more comprehensive determinations of water resource 
status. These studies have given us some stark revelations as to 
unprecedented predictions in population growth and needs for water 
resources over the next few years. The Rio Grande Valley Irrigation 
Districts have partnered with the Bureau of Reclamation on projects 
since the early 1950's. Most of the Districts have utilized BOR loan 
programs to do conservation projects. Many developed projects remain 
undone due to a lack of funding available to meet the needs. Districts 
have systematically chipped away at these projects within their budget 
restraints.
    Various changes in the water resource condition have made this slow 
progress unacceptable and has placed the agricultural and municipal 
supply needs in peril. Drier than normal conditions over the past nine 
years have exhausted water supplies and caused thousands of acres of 
land to become unproductive and unable to sustain the industry that 
depends on that production. Explosive developments in Mexico, which 
share the waters of the Rio Grande, have deprived the United States of 
a greater amount of the water resource, accelerating the crisis. 
Admittedly a part of the Mexico issue is drought related but a greater 
part is a change in Mexico's operations of their system that has 
deprived the U.S. users of over a year's supply of water and placed 
Mexico in violation of the terms of the 1944 Water Treaty.
    The population explosion in the Rio Grande Valley area is escalated 
by the massive legal and illegal migration from Mexico for which 
Congress continues to struggle with solutions even today. As if our 
population problems are not enough, Mexico's along the border are many 
times worse and they draw from the same resource.
    All of these pressures turn up the heat on the water resources for 
the Rio Grande. There are many valid concerns and frustrations over 
various issues that we desperately need congressional help with, but we 
also want to offer you a blue print for at least some of the solutions.
    The comprehensive water resource studies of which copies of these 
reports have been provided to this committee, an emphasis was made to 
seek solutions that would provide balance to the fragile economy and 
environment of the border region. The committees and consultants were 
charged with the responsibility of finding ways to provide an adequate 
water supply for the least amount of impact, both financial and 
physical. Our goal was to find enough firm yield water to provide for 
the municipal, industrial, environmental and agricultural needs of the 
region and to dovetail that plan into the expected growth needs of the 
Valley.
    The studies looked at desalination, reverse osmosis, runoff reuse, 
groundwater recovery, new dam sites, long distance pipelines and any 
other opportunity that presented any semblance of credible water 
supply. After several years of study it has become apparent that 
because agriculture uses 85% of the water available, agriculture must 
be the target for the major water conservation projects.
    S. 1577/H.R. 2990 provides the authorization for the Bureau of 
Reclamation to implement the programs and projects that surfaced as the 
most cost effective way to provide for the water resource needs of the 
Texas Border region. Most of the irrigation systems were built in the 
early 1900's and many of the delivery systems that are the lifeblood of 
the municipalities as well as agriculture must be renovated. 
Improvements to these canals would provide annually one half of a years 
current municipal needs in saved water. Other conservation projects 
that include volumetric accounting of the water and new technologies in 
water delivery could save another 75% of the municipal current annual 
needs. All of these projects can be accomplished for construction costs 
of from $0.02 to $3.07 per 1000 gallons which projects on a debt 
service basis from a fraction of a cent to $0.23 per 1000 gallons of 
water saved. The projects outlined in this legislation could more than 
double the water available for municipal and industrial use without 
collapsing the agricultural economy.
    The agricultural economy is extremely important to our region as a 
large portion of the workforce is dependent on the agriculture 
industry. The Border aspects of the region only increases this problem 
and agricultural layoffs create immediate social problems far beyond 
the normal expectations. We testified a couple of years ago that an 
undependable water supply could do irreparable damage and would push 
our local unemployment figures out of sight. We now have a report from 
Texas A&M that estimates as many as 30,000 jobs have been lost over the 
past nine years directly related to the water shortage on the Mexico 
shortfall alone.
    The importance of this legislation has only been accelerated by the 
past several years drought condition and recent information that 
indicate explosive demands in Mexico on the water resource. We 
recognize that we may have to live and grow on less water than we have 
been accustomed to. The latest work by Texas A&M University economist 
have documented losses approaching one billion dollars over the past 
five years attributable solely to Mexico's withholding of water from 
the four county region of the Lower Rio Grande Valley. We continue to 
lose farms and businesses that have been a part of the Rio Grande 
Valley heritage for over a hundred years, mostly because water resource 
demands the past seven years have been inadequate. The greatest impacts 
of these losses today are to our agricultural community; however, the 
associated impacts are beginning to take their toll to the Border 
Region as a whole. The cost of water to the general public is on the 
rise and will continue to do so as the scarcity of the resource 
manifests itself. Water shortages to the general populace have been 
held to a minimum but we are rapidly approaching a crisis in this arena 
also.
    This legislation allows us to turn these tragic losses around and 
provide new life and new hope to the whole Rio Grande Border Region. 
The infrastructure that is needed to solve these problems is apparent. 
Districts have planned these needed projects for years and anticipated 
accomplishing them over the next twenty or so years. Testimony today 
has shown you that we do not have that luxury. Every few acre feet of 
water not conserved is another family farm gone, another few jobs lost, 
another business who had to close their doors. Our future is in your 
hands.
    We appreciate your support for S. 1577. Thank you for your 
attention.

    The Chairman. Thank you very much for your testimony.
    Dr. Scholle, why don't you go right ahead.

    STATEMENT OF PETER SCHOLLE, Ph.D., STATE GEOLOGIST AND 
 DIRECTOR, NEW MEXICO BUREAU OF GEOLOGY AND MINERAL RESOURCES, 
NEW MEXICO INSTITUTE OF TECHNOLOGY, SOCORRO, NM, ACCOMPANIED BY 
  M. LEE ALLISON, Ph.D., STATE GEOLOGIST AND DIRECTOR, KANSAS 
     GEOLOGICAL SURVEY, UNIVERSITY OF KANSAS, LAWRENCE, KS

    Dr. Scholle. Thank you, Mr. Chairman, members of the 
committee. I am the director of the Bureau of Geology and 
Mineral Resources and the New Mexico State Geologist, as well 
as a member of the High Plains Aquifer Coalition. I am 
appearing today on the coalition's behalf in support of S. 
2773.
    The coalition is a joint effort between the Geological 
Surveys of the eight High Plains Aquifer States and the U.S. 
Geological Survey. The coalition's objective is to improve the 
geological characterization and understanding of the High 
Plains Aquifer.
    With me is Lee Allison, lead organizer of the coalition and 
the State geologist and director of the Kansas Geological 
Survey. We appreciate the invitation to appear before this 
committee.
    In introduction, a reliable source of water is essential to 
the well-being and livelihoods of the people in the High Plains 
region where ground water is used for drinking water, ranching, 
farming and other purposes. However, many areas of the High 
Plains Aquifer have experienced a dramatic depletion of this 
resource. The problem we face is that current water removal 
rates cannot be sustained, and the aquifer is being rapidly 
depleted.
    Let me begin with some facts about the aquifer. It 
encompasses one of the major agricultural regions in the world, 
it underlies 174,000 square miles and includes parts of eight 
States, New Mexico, Texas, Oklahoma, Kansas, Colorado, 
Nebraska, Wyoming and South Dakota, as you can see from the 
map. Approximately 2.3 million people live within the High 
Plains and the aquifer supplies drinking water for 82 percent 
of them. Agriculture, however, represents the dominant land and 
water use in the region, with 94 percent of ground water 
withdrawals from the aquifer for irrigation.
    The High Plains Aquifer is the single largest and most 
productive aquifer in the United States, yielding about 30 
percent of the Nation's ground water used for irrigation. 
During 1955, total water use outside the Platte River Valley in 
Nebraska, total water use in the High Plains was estimated to 
be 19.9 billion gallons per day, and outside the Platte River 
Valley in Nebraska, 92 percent of that need was met by aquifer 
water.
    Although High Plains dry land farming is possible, 
availability of water on demand from the aquifer has made 
abundant reliable crop yields a reality. As a result, the 
region accounts for about 19 percent of total U.S. production 
of wheat and cotton, 15 percent of our corn, 3 percent of our 
sorghum. In addition, the region produces nearly 18 percent of 
U.S. beef and is rapidly becoming a center for hog and dairy 
industries. Those numbers alone should elevate concern about 
the health of the aquifer from a regional to a national level.
    In terms of the aquifer, the High Plains Aquifer is often 
discussed as a single entity, but it's really a regional system 
composed of eight smaller units that are geologically similar 
and hydrologically connected, that is, water can move from one 
sub-aquifer to another. The aquifer consists of a heterogeneous 
mixture of loose clay, silts, sands and gravels deposited over 
millions of years by ancient river systems. The Ogallala 
Formation is the principal geologic unit but the aquifer as a 
whole also includes deposits that are older and younger than 
the Ogallala.
    The saturated thickness of the aquifer can exceed a 
thousand feet, but typically averages about 200 feet. The 
depths of the water table ranges from 0 to 500 feet, with an 
average of about 100 feet. Aquifer water generally flows 
westward and discharges naturally through streams and springs. 
Water may also be lost from the aquifer by evapotranspiration 
or through leakage into underlying rock units. However, pumping 
from numerous irrigation wells is the number one cause of 
ground water withdrawal.
    Precipitation is the dominant source of water recharge for 
the aquifer. The relatively low rainfall of the region limits 
aquifer recharge rates and thus provides a long-term limit on 
renewable water use. The estimated annual potential recharge 
from rainfall ranges from as little as a quarter of an inch per 
year in the southwestern portion of the aquifer, unfortunately 
in New Mexico, to 6 inches in the northeastern portion.
    Withdrawals greatly exceed recharge in many areas since 
extensive irrigation began in the 1940's. This has resulted in 
widespread water level declines, especially in southern areas, 
more than 100 feet in parts of Kansas, New Mexico, Oklahoma and 
Texas. In some places irrigation has become impossible or cost 
prohibitive because of such declines. From 1980 to 1997 the 
average water level in the aquifer fell 2.7 feet. Current 
drought conditions can only increase water use and aquifer 
drawdown rates.
    Looking at New Mexico specifically, 72 percent of the 
aquifer area that had potential water production now has less 
than 50 feet of saturated thickness. 30 feet is considered the 
economic minimum for irrigation. In addition, New Mexico's 
aquifer water levels are continuing to fall at average rates of 
a foot every four years, despite higher than average rainfall 
in the 1990's.
    The research needs are great. Because the structure for 
conducting hydrogeologic research on the aquifer differs 
dramatically among States, both the existing knowledge base and 
ongoing aquifer research efforts vary substantially from State 
to State. Much of the past research was limited by State 
expertise and budget allocations.
    To prevent future inconsistencies among State research 
efforts and to efficiently utilize existing research data, the 
High Plains Aquifer Coalition was chartered a year ago. During 
that year the coalition has begun an information exchange and 
standardization process and is in the early stages of 
developing a cooperative regional strategic plan for scientific 
research and collaboration.
    Through past research we have learned that the aquifer is 
heterogeneous, consists of many subregions and small flow 
units. Past research also helped identify the need to focus 
future research efforts on geological and hydrological 
characterizations, mapping, modeling and monitoring of aquifer 
subunits. Improved knowledge of these areas will refine our 
understanding of the aquifer, provide better tools and 
strategies for long-term coordinated aquifer management, and 
ultimately will lead to the development of improved approaches 
for enhancing and extending the life of the aquifer.
    State water and local water users, managers and regulators 
increasingly are demanding the types and quality of data needed 
to develop useful and reasonable water management programs. The 
resources currently available to State and Federal universities 
are insufficient to meet these needs. Added Federal funds would 
expand existing capabilities and enhance the efforts of ongoing 
local State funding.
    The eight coalition State geological surveys and the U.S. 
Geological Survey are nonregulatory scientific agencies that 
are impartial. In consultation with State and local water 
agencies and groups, they have agreed on a need for a 
comprehensive understanding of the subsurface configuration and 
hydrogeology of the High Plains aquifer.
    Major research questions include rates and controls on 
recharge, relationships among saturated thickness, geologic 
character and well yield, relationships among water levels, 
water use and aquifer lifetime, and impact of climate change. 
More detailed discussions of specific science plans are 
included in the written testimony and won't be covered here.
    S. 2773 establishes procedures to ensure that the research 
performed is that most critical to water users and managers. 
The bill would require that broadly based State advisory groups 
concur with proposed studies, that peer review ensures that 
research is of the highest quality, that funds are awarded on 
merit, and that there is technical review of both Federal and 
State activities. These procedures provide an unusually 
rigorous level of accountability.
    In conclusion, this bill will help ensure that the relevant 
science needed to address aquifer depletion is available so 
that we will have a better understanding of resources of the 
High Plains Aquifer. We urge this subcommittee to support S. 
2773. This concludes our testimony on behalf of the coalition, 
but we would be happy to answer questions that you may have.
    [The prepared statement of Dr. Scholle follows:]

  Prepared Statement of Peter A. Scholle, Ph.D., State Geologist and 
   Director, New Mexico Bureau of Geology and Mineral Resources, New 
              Mexico Institute of Technology, Socorro, NM

    Mr. Chairman and Members of the Committee, my name is Peter 
Scholle, and I am the Director of the Bureau of Geology and Mineral 
Resources, the New Mexico State Geologist, and a member of the High 
Plains Aquifer Coalition. I am appearing today on the Coalition's 
behalf in support of Senate Bill 2773--The High Plains Aquifer 
Hydrogeologic Characterization, Mapping, Modeling and Monitoring Act. 
The Coalition is a joint effort between the geological surveys of the 
eight High Plains Aquifer states and the U.S. Geological Survey. The 
Coalition objective is to improve the geological characterization and 
understanding of the High Plains aquifer. With me is Lee Allison, the 
lead organizer of the Coalition, and the State Geologist and Director 
of the Kansas Geological Survey. We appreciate the invitation to appear 
before this Committee.

                              INTRODUCTION

    A reliable source of water is essential to the well-being and 
livelihoods of people in the High Plains region where ground water is 
used for drinking water, ranching, farming, and other purposes. Many 
areas of the High Plains aquifer have experienced a dramatic depletion 
of this resource. Large-volume pumping from this aquifer has led to 
steadily declining water levels in the region, and the area faces 
several critical water-related issues.
    Let me begin with some facts about the aquifer. The High Plains 
aquifer is the most widespread blanket sand and gravel aquifer in the 
nation. It encompasses one of the major agricultural regions in the 
world and underlies 174,000 square miles, including parts of eight 
states New Mexico, Texas, Oklahoma, Kansas, Colorado, Nebraska, Wyoming 
and South Dakota. (Figure 1) *
---------------------------------------------------------------------------
    * Figures 1-4 have been retained in subcommittee files.
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    Approximately 2.3 million people live within the High Plains, and 
the aquifer supplies drinking water for 82 percent of them. 
Agriculture, however, represents both the dominant land and water use 
in the region (94 percent of groundwater withdrawals from the aquifer 
are for irrigation). The High Plains aquifer is the most intensely 
pumped aquifer in the United States, yielding about 30 percent of the 
nation's ground water used for irrigation. During 1995, total water use 
in the High Plains was estimated to be 19.9 billion gallons per day 
and, with the exception of the Platte River Valley of Nebraska, 92 
percent of that need was met by aquifer water.
    Although High Plains dry-land farming is possible, availability of 
``water on demand'' from the aquifer has made abundant, reliable crop 
yields a reality. As a result, the region accounts for about 19 percent 
of total U.S. production of each wheat and cotton, 15 percent of our 
corn, and 3 percent of our sorghum. In addition, the region produces 
nearly 18 percent of U.S. beef and is rapidly becoming a center for hog 
and dairy industries. Those numbers alone should elevate concern about 
the sustainability of the aquifer from a regional to a national level.

                        AQUIFER CHARACTERIZATION

    Aquifers are underground deposits containing permeable rock or 
sediments (silts, sands, and gravels) from which water can be pumped in 
usable quantities. Although the High Plains aquifer often is discussed 
as a single entity, it is a regional system composed of eight smaller 
units that are geologically similar and hydrologically connected that 
is, water can move from one aquifer to the other. The aquifer is 
unconfined, that is, it is not confined under pressure below 
impermeable rocks as artesian water is. The aquifer consists of a 
hetereogeneous mixture of loose clays, silts, sands, and gravels that 
formed over millions of years by ancient river systems. The Ogallala 
Formation is the principal geologic unit, but the aquifer as a whole 
also includes deposits that are older and younger than the Ogallala. In 
some locations, the Ogallala Formation crops out at the surface, 
forming a naturally cemented rock layer called mortar beds.
    Aquifer characteristics are determined in large part by geology. 
The High Plains aquifer is composed mainly of silt, sand, gravel, and 
clay-rock debris that washed off the face of the Rocky Mountains and 
other more local sources over the past several million years. The 
aquifer varies greatly from place to place: thick in some places, thin 
in others; permeable (able to transmit water easily) in some places, 
less so in others. Where the deposits are thick and permeable, water is 
easily removed and the aquifer can support large volumes of pumping for 
long periods. In most areas, this water is of good quality.
    Beneath the High Plains aquifer is much older, consolidated 
bedrock, usually limestone, sandstone, or shale. In some places this 
bedrock holds enough water to be called an aquifer, and it may be 
connected to the overlying aquifer. Some layers of the underlying 
bedrock contain saltwater; where these are directly connected to the 
High Plains aquifer, they pose a threat to water quality.

               WATER RESOURCES IN THE HIGH PLAINS AQUIFER

    Usable water in the High Plains aquifer is in the pore spaces 
between particles of sand and gravel. This water (called ground water) 
accumulated slowly--in some of the deeper parts of the aquifer, over 
tens of thousands of years. In the subsurface, water in the aquifer 
generally moves slowly from west to east, usually at the rate of tens 
of feet per year.
    Water volumes and use are measured in various ways. One measure is 
an acre-foot, or the amount of water necessary to cover an acre of 
ground (a parcel about the size of a football field) with a foot of 
water. An acre-foot equals 325,851 gallons of water.
    Another measure of ground water is saturated thickness. The 
saturated thickness of the High Plains aquifer is the vertical distance 
between the water table and the base of the aquifer. Saturated 
thickness is commonly measured in feet but ``feet of saturated 
thickness'' is not the same as feet of actual water. Only about 10 to 
25 percent of the aquifer volume is pore space that can yield 
extractable water. Therefore, in an aquifer with 17 percent pore space, 
removing 1 acre-foot of water causes the water table to drop by about 6 
feet. The saturated thickness of the aquifer can exceed 1,000 feet, but 
averages about 200 feet. Depth to water table ranges from 0 to 500 
feet, with an average of about 100 feet. Much greater saturated 
thicknesses were common before the onset of large-scale irrigation.
    Groundwater can also be measured in terms of its availability: how 
much water can be removed by a well over short periods. Large volumes 
of water can be pumped rapidly (1,000 gallons or more per minute) from 
the High Plains aquifer in many locations. This contrasts with many 
areas in the region, where wells generally produce smaller amounts 
(less than 100 gallons per minute). By way of comparison, a good 
household well produces 5 to 10 gallons per minute, although many 
household wells produce less.
    Recharge is the natural movement of water into an aquifer, usually 
from precipitation. Areas of increase can also be the result of 
increased recharge to the aquifer by one or more of the following 
factors: greater than normal precipitation; decreased withdrawals; or 
downward leakage of surface-water irrigation and water from unlined 
canals and reservoirs. The relatively low rainfall of the region limits 
aquifer recharge rates and thus provides a long-term limit on 
sustainable water use. The estimated average annual potential recharge 
from rainfall ranges from as little as 1/4 of an inch per year in the 
southwestern portion of the aquifer area to 6 inches in the 
northeastern portion. Where the aquifer is closer to the earth's 
surface, where soils are sandier, and precipitation amounts greater, 
recharge can be significant, as much as 4 to 6 inches per year.
    Withdrawals greatly exceeded recharge in many areas since intensive 
irrigation began in the 1940's. This has resulted in widespread water-
level declines, especially in southern areas--more than 100 feet in 
parts of Kansas, New Mexico, Oklahoma and Texas. In some places, 
irrigation has become impossible or cost prohibitive because of such 
declines. From 1980 to 1997, the average water level in the aquifer 
fell 2.7 feet. (Figure 2 )
    Aquifer water generally flows eastward and discharges naturally to 
streams and springs. Water may also be lost from the aquifer by 
evapotranspiration or through leakage into underlying rock units. 
However, pumping from the numerous irrigation wells is the number one 
cause of groundwater withdrawal. Decreases in saturated thickness of 10 
percent or more result in a decrease in well yields and an increase in 
pumping costs because the pumps must lift the water from greater depths 
(Figures 3 & 4).

                  WATER-LEVEL DECLINES IN THE AQUIFER

    Large-scale irrigation began in the High Plains in the late 1800's, 
with the use of ditches to divert water from rivers. As technology 
improved, groundwater became the major irrigation source because 
surface water (lakes, rivers, and streams) is relatively scarce in the 
region. With the advent of large-capacity pumps that were capable of 
drawing several hundred gallons of water per minute, people began to 
exploit that ground water. Using a technique called flood irrigation, 
water was pumped through long pipes or ditches along the edges of a 
field, then out onto rows of crops.
    In the 1950's and 1960's, technological developments led to a 
dramatic increase in large-scale pumping. In particular, center-pivot 
irrigation systems--large sprinklers that roll across the land on 
wheels--allowed people to irrigate uneven terrain, thus opening up 
large new areas for irrigation. These irrigation methods led to the 
cultivation of crops, such as corn, that could not previously be grown 
reliably in the area.
    For many years, people believed that the High Plains aquifer 
contained an inexhaustible amount of water. However, large-volume 
pumping (mostly for irrigation) eventually led to substantial declines 
in the water table, and people realized that the amount of water in the 
aquifer was finite and could be exhausted. Much of the Ogallala portion 
of the High Plains aquifer has declined since predevelopment, with some 
areas having declines of more than 60 percent.

                     WHEN WILL THE AQUIFER RUN DRY?

    Perhaps the most common and important question about the High 
Plains aquifer is: How much longer can it support large-scale pumping? 
It's a simple question with a complicated answer. First, the aquifer 
will probably be able to support small, domestic wells far into the 
future. With proper planning, most cities and towns should be able to 
provide for their water needs. Second, the future of agricultural use 
of the aquifer depends on a variety of factors, including the price of 
irrigated crops, the price and availability of energy (the deeper the 
water table, the more energy it takes to pump water), climate, and how 
the water is managed. Third, it is important to remember that the 
aquifer is not one consistent, homogeneous unit. Rather, it varies 
considerably from place to place. In places, the aquifer consists of 
less than 50 feet of saturated thickness and receives little recharge. 
In other places, the aquifer is far thicker or receives considerably 
more recharge.
    With those qualifications in mind, researchers have made 
projections about the aquifer, based on past trends in water-level 
declines. Obviously, the actual future use of water will be affected by 
commodity prices, energy prices, climate, and management policies. In 
addition, relatively little data are available for some parts of the 
aquifer, and projections are not practical in those areas. Assuming a 
saturated thickness of 30 feet as the minimum amount necessary to 
support large-scale pumping, researchers concluded that parts of the 
aquifer are effectively exhausted in some areas. Other parts of the 
aquifer are predicted to have a lifespan of less than 25 years, based 
on past decline trends. However, the biggest share of the aquifer would 
not be depleted for 50 to 200 years or longer. It is important to 
remember that these projections are based on past trends, and future 
changes could alter the actual depletion rate.

                       WHERE DO WE GO FROM HERE?

    Individuals, governmental agencies, and private organizations are 
all attempting to address issues related to the High Plains aquifer. In 
addition, several new institutions have recently been proposed to deal 
with issues concerning the aquifer on a regional basis. Irrigators have 
implemented a number of techniques that have improved the efficiency 
with which they use water--using low-pressure application methods on 
center-pivot systems, for example, instead of spraying water high into 
the air.
    Among the more far-reaching proposals for extending the life of the 
aquifer is the idea of sustainable development. This is the concept of 
limiting the amount of water taken from the aquifer to no more than the 
amount of recharge, and perhaps less, depending on the impact on water 
quality and minimum streamflows. This level of use is the target of the 
safe-yield management policies currently in effect in some Groundwater 
Management Districts in the wetter or thicker parts of the High Plains 
aquifer. Adoption of a similar policy in other areas of the High Plains 
aquifer would require a substantial decrease in the amount of water 
currently used. This would have an impact on the type and amount of 
crops grown in the area and, in turn, on a variety of economic 
activities. Because many of the water rights in the High Plains aquifer 
were established long ago and thus may have priority, the 
implementation of sustainable-development approaches to water resources 
has potentially serious legal implications. Other methods for dealing 
with the High Plains aquifer are being proposed, discussed, and 
implemented. All are aimed at extending the life of this crucial 
resource.

                     HIGH PLAINS AQUIFER COALITION

    Each state manages its water resources differently. The number of 
state and local water agencies and their duties vary dramatically among 
the eight High Plains states. None of the eight state geological 
surveys deal directly with groundwater management. State geological 
surveys provide scientific advice to their respective state and local 
management agencies. Some state surveys focus strictly on the geologic 
framework in which groundwater exists, others investigate both the 
geology and the hydrology of groundwater.
    Because the structure for conducting hydrogeologic research on the 
aquifer differs dramatically among states, both the existing knowledge 
base and ongoing aquifer research efforts vary substantially from state 
to state. Much of past research was limited by state expertise, budget 
allocations and cooperation among state agencies. To prevent future 
inconsistencies among state research efforts and to efficiently utilize 
existing research data, in June 2000, the geological surveys of the 
eight states that contain the High Plains aquifer formed the High 
Plains Aquifer Coalition, in alliance with the U.S. Geological Survey. 
Coalition members are Kansas Geological Survey, New Mexico Bureau of 
Geology and Mineral Resources, Nebraska Conservation and Survey 
Division, Texas Bureau of Economic Geology, Colorado Geological Survey, 
Oklahoma Geological Survey, South Dakota Geological Survey, Wyoming 
State Geological Survey, and U.S. Geological Survey.
    The purpose of the Coalition is to cooperate in joint 
investigations and scientific exchanges concerning the earth sciences 
(including hydrology, geology, geochemistry, geochronology, geophysics, 
geotechnical and geological engineering and related investigations) on 
topics of mutual interest. This agreement was specifically undertaken 
to advance the understanding of the three-dimensional distribution, 
character, and nature of the sedimentary deposits that comprise the 
High Plains aquifer in the eight-state Mid-continent region. It 
recognizes that the distribution, withdrawal, and recharge of 
groundwater, and the interaction with surface waters is profoundly 
affected by the geology and the natural environment of the High Plains 
aquifer in all eight States--New Mexico, Texas, Oklahoma, Colorado, 
Kansas, Nebraska, South Dakota, and Wyoming--thereby establishing a 
commonality of interests among the Surveys and citizens of these 
states.
    The Geological Surveys agreed that reaching a fuller understanding 
of the three-dimensional framework and hydrogeology of the High Plains 
Aquifer is necessary to provide local and state policymakers with the 
earth-science information required to make wise decisions regarding 
urban and agricultural land use, the protection of aquifers and surface 
waters, and the environmental well being of the citizens of this 
geologically unique region.

                             RESEARCH NEEDS

    Through past research, we have learned that the aquifer consists of 
many sub-regions or smaller units. Past research also helped identify 
the need to focus future efforts on geological and hydrological 
characterization, mapping, modeling and monitoring of aquifer subunits. 
The eight state geological surveys and the U.S. Geological Survey, in 
consultation with state and local water agencies and groups, have 
agreed on the need for comprehensive understanding of the subsurface 
configuration and hydrogeology of the High Plains Aquifer. Improved 
knowledge in these areas will refine our understanding of the aquifer 
and provide better tools and strategies for long-term, coordinated 
aquifer management.
    The High Plains Aquifer Coalition is in the early stages of 
developing a cooperative regional strategic plan for scientific 
research and collaboration that will lead to a more detailed 
understanding of what research is required in the region. Major 
research questions in the High Plains aquifer include: rates and 
controls on recharge, relationships among saturated thickness, geologic 
character, and well yield, relationship among water levels, water use, 
and aquifer lifetime, impacts of climate changes, and appropriate scale 
and precision of data sets for new management approaches.
    Topical research areas that we anticipate to be addressed by this 
legislation include the following:

   Research on the regional geologic framework, particularly 
        the completion of detailed, quadrangle-size (1:24,000 scale) 
        surface and subsurface geologic maps and models in digital 
        format, and the public dissemination of these maps and models, 
        as well as interpretive information derived from them.
   Research on geologic processes relating to deposition of 
        sedimentary sequences--their definition, nature, extent, 
        origin, and bounding surfaces--forming the High Plains aquifer 
        and adjacent aquifers.
   Research on the region's hydrogeology and its fluid systems.
   Research on processes controlling the quantity and quality 
        of water recharging the High Plains aquifer, including the 
        effect of past and future changes in climate and land-use 
        activities on recharge.
   Research on enhancing the recharge of the High Plains 
        aquifer.
   Research on the porosity, permeability, storage capacity, 
        and specific yield of the aquifer.
   Research on the geological and hydrological processes 
        controlling regional differences and temporal changes in water 
        quality.
   Research on the vertical and lateral exchange of groundwater 
        between different formations that make up the High Plains and 
        adjacent aquifers and the effect of such exchange on water 
        quality in the High Plains aquifer.
   Research on the age of groundwater recharging and moving 
        through the aquifer.
   Research on improved techniques for modeling the occurrence, 
        movement, and quality of water in the High Plains aquifer.
   Research on using geophysical techniques, procedures, and 
        models for regional application in mapping subsurface deposits 
        in the Mid-continent region.
   Transfer of technology and information among the Surveys and 
        to both the private and public sectors.

    In addition to a possible increase in the density of data for 
adequate aquifer management the Coalition has identified a preliminary 
list of other data that would be needed to develop an aquifer 
management plan. These include:

   Determination of the approach to define aquifer subunits, 
        such as hydrologic boundaries, ground-water divides, 
        hydrological characteristics, aquifer extent, major differences 
        in recharge, or saturated thickness, in conjunction with 
        administrative boundaries.
   Determination of recharge, stream outflow, and ground-water 
        inflow and outflow to give estimates of net sustainable 
        quantities of water to be pumped from areas of different 
        saturated thickness in the High Plains aquifer.
   Estimates of total saturated thickness and how it varies 
        across the aquifer that will be needed for continued pumping.
   Estimates of depth ranges from ground surface to the base of 
        the aquifer.
   Assessment of uncertainties for estimating sustainable yield 
        volumetrics of the aquifer, including practical saturation 
        thickness, water level measures, and depth to bedrock in 
        different areas.
   Determination of methods to reduce the largest uncertainties 
        in calculating the aquifer volume.
   Delineation of critical recharge areas.
         why the bill is important to the region and the nation
    Extending the life of the High Plains aquifer is essential to the 
economic viability of the region because there are no realistic 
alternative water sources. Accurate data about aquifer variability and 
subunit characteristics will allow us to accurately determine current 
water levels, where and at what rates aquifer water moves, and the 
variables that impact water recharge rates in aquifer subunits. 
Knowledge of these factors will allow us to better predict future water 
levels and ultimately will lead to development of improved approaches 
for enhancing and extending the life of the aquifer and other factors 
useful for management purposes.
    Federal funds will expand existing capabilities and enhance the 
effects of ongoing state and local funding. Complementary funding will 
allow us to build regional databases and understanding of the aquifer. 
The bill enlists expertise from the U.S. Geological Survey not 
available at the state level and fosters better coordination with other 
groups within states and across state boundaries. State and local water 
users, managers and regulators are increasingly demanding the types and 
quality of data needed to develop useful and reasonable water 
management programs. For example, in Kansas, local Groundwater 
Management Districts are requesting subunit characterization of the 
aquifer that requires a more sophisticated and regional understanding 
of the nature of the aquifer. Current resources for state and federal 
water agencies are insufficient to meet these increasingly demanding 
needs.
    Senate Bill 2773 establishes procedures to ensure that the research 
carried out is that most critical to water users and managers. The bill 
would require that broadly based state advisory groups concur with 
proposed studies; that peer review ensures the research is of the 
highest quality; that funds are awarded on merit; and that there is 
technical review of both federal and state activities. These procedures 
provide an unusually rigorous level of accountability.
    In conclusion, this bill is an important first step in a 
comprehensive program to extend the life of the aquifer. The bill will 
help ensure that the relevant science needed to address aquifer 
depletion is available so that we will have a better understanding of 
the resources of the High Plains aquifer and can ultimately lead to 
extending the life of the aquifer. We urge this Subcommittee to support 
Senate Bill 2773 The High Plains Aquifer Hydrogeologic 
Characterization, Mapping, Modeling and Monitoring Act. This concludes 
my testimony on behalf of the Coalition. We are submitting additional 
written testimony for your review. Thank you for your consideration. We 
would be happy to answer any questions that you may have.

    The Chairman. Thank you very much. Dr. Allison, did you 
have any comments you wanted to add?
    Dr. Allison. Mr. Chairman, no. I'm here in support in terms 
of questions.
    The Chairman. All right. Well, thank you all very much. Dr. 
Scholle, let me just ask you, it seems as though when I hear 
your testimony, this is something of a race against time in the 
sense that the levels that water is being consumed out of this 
aquifer is substantially greater than the level at which it's 
being recharged, and do you believe that what we have in this 
legislation will allow for the research to be done quickly 
enough that we can get answers to actually change some policies 
and address the problem? I mean, is this going to be a 
situation where we're studying the problem after it's too late 
to do anything about it?
    Dr. Scholle. Well, I should first say that the aquifer 
depletion, as you can see on that map which depicts aquifer 
depletion areas, aquifer depletion is very inconsistent in 
different areas. New Mexico actually has some of the most dire 
problems, as do Texas, Oklahoma and Kansas to the north. In 
Nebraska, there is actually an increase in water levels in the 
aquifer, so the problem is highly variable from place to place.
    I do believe that the resources that would be put into this 
program certainly will speed our understanding of the aquifer. 
I think that substantial understanding will come within the 
next 5 to 10 years through these studies, and will indeed make 
an impact on the information available to decision makers.
    Just to illustrate the problem, there's probably somewhere 
between half a million and a million wells in the High Plains 
aquifer. Of those, we have done long-term monitoring on 5,000 
wells. I mean, that's a trivial number of wells in terms of 
understanding the details. I mean, you see the broad sketches, 
the broad outline of where increases are extant and where 
decreases are extant in the aquifer, but the details are far 
more complex than are depicted on that diagram. 5,000 wells is 
what we have long-term monitoring on, we are now doing 
monitoring on about 10,000 wells in total, and it's still a 
tiny tiny fraction, and that's probably the best known portion 
of the entire problem.
    In terms of aquifer characterization, in terms of 
geological knowledge, we are far far behind the curve and all I 
can say is that we will make our utmost effort to get the data 
as quickly as possible in response to this bill and in response 
to the needs.
    The Chairman. All right. Well, thank you very much, and we 
will take all the testimony that has been submitted here and 
consider it as we try to move ahead on these various pieces of 
legislation.
    So thank you all very much, and that will conclude our 
hearing.
    [Whereupon, at 4:18 p.m., the hearing was adjourned.]

                                APPENDIX

              Additional Material Submitted for the Record

                              ----------                              

   Statement of Dave Jones, Chairman, Hill County Water District and 
  Vice-Chairman of the North Central Montana Regional Water Authority
    Mr. Chairman and members of the subcommittee, my name is Dave 
Jones. I am Chairman of the Hill County Water District and Vice-
Chairman of the North Central Montana Regional Water Authority. Thank 
you for the opportunity to provide this statement in support of Senate 
Bill 934 authorizing the Rocky Boy's/North Central Montana Regional 
Water System. I would also like to thank Senator Max Baucus and Senator 
Conrad Burns for their strong and continuing support for this project.
    The Hill County Water District is located in northern Montana, 
generally between the communities of Chester and Havre. The District 
was created to provide water service to the communities of Joplin, 
Inverness, Rudyard, Hingham, Gildford and Kremlin, as well as the 
outlying rural areas. Hill County Water District has approximately 800 
users. The average water bill is roughly $75.00 per month, based on 
average water consumption of 7,500 gallons per household per month.
    Currently, the Hill County Water District is served by two water 
supplies. Water from the Fresno Reservoir, located on the Milk River, 
serves as the primary source and is supplemented by an infiltration 
gallery along the banks of the Marias River. The Fresno Reservoir 
supply is not filtered. The Environmental Protection Agency (EPA) rules 
dictate that all public water supply systems must filter and treat all 
surface water. Hill County Water District is on EPA's Significant Non-
Compliance (SNC) list as they are in violation of the Surface Water 
Treatment Rule (SWTR) of the Safe Drinking Water Act (SDWA). Hill 
County Water District received an Administrative Order in 1994 for this 
violation. The Order was amended in 1998 and again in 2001.
    Several years ago, the communities of Kremlin and Gildford combined 
their schools. The elementary school (K-8) is located within the 
community of Kremlin. The District administers chlorination to the 
system at Kremlin. The community does not have adequate chlorination 
contact time, as required by the SDWA. The community, including the 
school, has been on a boil order since 1998.
    When the District received the first administrative order, an 
engineering firm was hired to evaluate all available alternatives to 
the District. The evaluated alternatives included groundwater and 
construction of a Fresno Reservoir Water Treatment Plant.
    Prior to the formation of the Hill County Water District and 
construction of its current water system, the communities now served by 
the District either hauled water from nearby communities or were served 
by shallow or moderately deep wells. The wells generally yielded modest 
quantities of water that were of very poor quality. The total dissolved 
solids in some of the early wells were so high that the water could not 
be used for drinking or irrigation. The sodium was also very high, 
ranging from 397 ppm to 2,500 ppm. The generally accepted standard for 
sodium is 270 ppm. Iron and manganese were also persistent water 
quality problems, as was sulfate.
    The engineering firm investigated seven different treatment 
alternatives for the Fresno supply. Based on the maximum day demand, 
the water treatment plant would need a total capacity of 1.4 million 
gallons per day. Several alternatives were eliminated due to the 
difficulty in treating Milk River water, which supplies Fresno 
Reservoir. Conventional treatment is a well established technology for 
treating water from the Milk River. The capital cost to construct a 
conventional package plant, based on 1993 cost estimates, was $1.2 
million. The District was able to secure $700,000 combined local funds 
and state grants. Based on a $500,000 loan from the State of Montana's 
Revolving Loan Program, the debt service would be approximately $46,000 
per year. The monthly user rate, just for debt service, would increase 
by $5.00 per month. In addition, the existing rate does not include the 
additional cost for operation and maintenance of a treatment plant. 
Estimates for these expenses, prepared for the District, range from $15 
to $20 per month per user. If the District was to construct its own 
water treatment plant, the cost to the individual user would exceed 
$100 per month, making it unaffordable to the District's residents.
    DEQ is investigating if the supplemental water source for the 
District at the Marias River is also under the influence of surface 
water. If this supplemental water source was determined to be under the 
influence of surface water, it would also need to be filtered and 
treated. To construct and maintain two treatment plants would be a 
substantial financial burden.
    HKM Engineering of Billings, Montana, prepared an estimate of each 
individual system's user rate, once the system joins the Rocky Boy's/
North Central Montana Regional Water System. The estimated user rate 
for the Hill County Water District was $58.07 per month. Clearly, the 
Regional Water System would be more affordable.
    According to the U.S. Bureau of Reclamation, the storage at Fresno 
Reservoir during this winter was at 15% of normal. One of the 
District's intake structures at the Reservoir is exposed. On March 28, 
2002, the U.S. Secretary of Agriculture declared the State of Montana a 
disaster area due to drought. The District is very concerned about the 
ability to draw water from the Reservoir given the ongoing drought 
condition.
    The Montana Department of Environmental Quality (DEQ) has been very 
supportive of the regional water system concept because of the obvious 
advantages offered to small public water systems, such as the Hill 
County Water District. The DEQ sees that is in the best long-term 
interest of the Hill County Water District to connect to the Regional 
System. (See attached letter from Jan Sensibaugh, Director of Montana 
DEQ, to Dan Keil).
    In 2001, the DEQ issued an amended Administrative Order to the 
District. The most current Order imposes the following deadlines for 
enforcement actions:

   Deadline for federal project authorization--December 1, 2002
   Deadline for submission of engineering plans--December 14, 
        2003
   Deadline for beginning construction--June 1, 2004
   Deadline for providing water service--December 31, 2007

    My District is under the gun to meet the above compliance schedule. 
The Board of Directors of Hill County Water District believes that the 
Rocky Boy's/North Central Montana Regional Water System will resolve 
many of our most significant water supply problems.
    I respectfully request that the committee pass S. 934 authorizing 
the Rocky Boy's/North Central Montana Regional Water System.
    Thank you. It is an honor to provide this statement to the 
committee.
                                 ______
                                 
               Montana Department of Environmental Quality,
                                        Helena, MT, March 30, 2001.
Dan Keil,
Chairman, North Central Montana Regional Water Authority, Havre, MT.

Re: Department compliance actions

    Dear Mr. Keil: My thanks to you and the representatives of the 
North Central Montana Regional Water Authority (Authority) for meeting 
with department staff in Great Falls on February 22. The information 
provided to our staff helped to clarify the status of the Rocky Boys/
North Central Montana Regional Water System (System).
    As you know, the department has an outstanding enforcement action 
against the Hill County Water District. The order was issued in 1994, 
amended in 1998, and now must be amended again because the compliance 
deadlines in the current order have not been met. Additionally, the 
department may initiate similar actions against other public water 
suppliers with compliance problems that have expressed interest in 
connection to the System. These additional compliance actions would be 
initiated because of inadequate treatment of surface water sources (or 
groundwater sources that have been directly influenced by surface 
water).
    The department is very supportive of the regional water system 
concept because of the obvious advantages offered to small public water 
suppliers. Numerous small water suppliers that are facing important 
compliance decisions would benefit specifically by connection to this 
System. It is our intention to promote this solution to the maximum 
extent allowed within our statutory authority and responsibility.
    Our role as a regulatory agency imposes direct responsibility for 
protecting the public health of those served by public water supplies 
in Montana. Because we believe that it is in the best long-term 
interest of your customers to connect to the System, we intend to allow 
additional time for those water suppliers affected by department 
compliance actions.
    However, considerable time has elapsed since the original 
enforcement action was taken against Hill County. We believe that it is 
important that deadlines for important milestones be established to 
ensure that public exposure to risks from inadequately treated sources 
be minimized.
    In order to address this concern, we intend to impose the following 
deadlines for public water suppliers affected by department enforcement 
actions:

   Deadline for funding authorization--December 1, 2002
   Deadline for submission of engineering plans--December 15, 
        2003
   Deadline for beginning construction--June 1, 2004
   Deadline for providing water service--December 31, 2007

    These deadlines would be included in the revised order for the Hill 
County Water District, and for any other systems placed under similar 
enforcement actions. At this time, it appears that two additional water 
suppliers that are interested in connection to your System will be 
placed under department enforcement actions in the near future.
    Until water service is provided to the affected water suppliers 
from your System, we believe it is very important that those suppliers 
provide an alternative approved source of water for their customers. It 
is not reasonable to assume that customers of these supplies will boil 
their water or otherwise obtain properly treated water until the above 
deadlines are met. However, we will work with each affected supplier to 
develop the best, most economical solution to providing safe water on 
an interim basis.
    Congratulations to you and your member systems in the work that has 
been accomplished to date. If you should have any questions, or if 
there is something that we can do to help support your efforts, please 
do not hesitate to contact me.
            Sincerely,
                                         Jan P. Sensibaugh,
                                                          Director.
                                 ______
                                 
     Statement of John Tubbs, Chief, Resource Development Bureau, 
        Montana Department of Natural Resources and Conservation

    Mr. Chairman and members of the committee, for the record my name 
is John Tubbs. I am Chief of the Resource Development Bureau of the 
Montana Department of Natural Resources and Conservation. As a 
representative of the State of Montana, I want to thank you for the 
opportunity to provide this statement in support of Senate Bill 934 
authorizing the ``Rocky Boy's/North Central Montana Regional Water 
System Act of 2001.''
    Governor Martz has asked me to relay her strong support of the 
proposed regional water project in North Central Montana. Governor 
Martz is very interested in seeing this project authorized because of 
the tremendous need for safe drinking water in this area of Montana and 
the benefits the regional water system can provide to the water users, 
the state and the nation. As my testimony will demonstrate, the support 
of the State of Montana for this project is strong and comes with a 
significant financial commitment for funding.
    The Tribal Government of the Rocky Boy's Reservation has been 
trying to address a serious need for safe drinking water. In 1999, the 
Montana Legislature and the Rocky Boy's Tribal Council approved a water 
compact that, in part, provides 10,000 acre-feet of water out of Tiber 
reservoir for the Rocky Boy's Reservation. In 2000, Congress authorized 
the Rocky Boy's compact and in 2001 appropriated settlement funds. A 
portion of these funds, $16 million are for on reservation water 
distribution works. S. 934 will provide authorization for the 
transmission and treatment of waters from Tiber reservoir to the Rocky 
Boy's Reservation.
    The driving need for a reliable, high quality water supply on the 
reservation presented the opportunity for a regional water system to 
serve tribal members and non-tribal communities. Working with local and 
state representatives, tribal leaders have taken this opportunity to 
work with their neighbors to achieve a common goal, adequate and safe 
drinking water for our communities. It is so important to note this 
positive action of both the tribal and non-tribal communities working 
together. When the tribal leaders reached out to their neighbors and 
extended this opportunity and vision, they bridged a gap in 
relationships that had existed for decades. The proposed Rocky Boy's/
North Central Montana Regional Water System is a shared vision based on 
a common need.
    In the early 1990's, representatives from the tribal and non-tribal 
governments met to begin the planning for this project. The benefits of 
a regional water supply were unquestionable, but the size and cost of 
the proposal led to many questions about economic feasibility. An 
interagency team was assembled to coordinate a state review of the 
proposed regional water system. The team is composed of representatives 
for the Departments of Natural Resources and Conservation, 
Environmental Quality, and Commerce. This state coordinating committee 
is still actively evaluating the proposal. Two state grants have been 
awarded to provide funding for preliminary engineering for the system 
so everyone can base their support for this project on factual 
information. In the 1990's, several studies were completed to 
demonstrate the cost effectiveness of the proposed regional water 
system and to assure that were no significant environmental impacts. 
Published reports as to the feasibility of a regional water system 
include:

          North Central Montana Regional Water System Needs Assessment, 
        Dated May 19, 1997. Prepared by MSE-HKM, Inc.
          North Central Montana Regional Water System Environmental 
        Assessment. Prepared by MSE-HKM, Inc.
          North Central Montana Regional Water System Feasibility 
        Study, Dated October 9, 1997. Prepared by MSE-HKM, Inc.
          North Central Montana Regional Water System Appraisal Level 
        Study, dated June 27, 1997. Prepared by MSE-HKM, Inc.
          North Central Montana Regional Water System Planning/
        Environmental Report, dated May, 2000. Prepared by MSE-HKM, 
        Inc.

    Once authorized, further design studies will be conducted and an 
environmental assessment report published.
    What has been determined is that water quality is poor in some 
areas of the region. with inadequate water quantity is often an issue. 
Communities and water districts in the region have tried to attack this 
problem through several methods. Some are chlorinating surface water 
but do not have filters in place as required under the 1986 Safe 
Drinking Water Act. As a result. at least three systems are currently 
out of compliance with federal safe drinking water standards. As many 
as 13 of the remaining systems are expected to have difficulty meeting 
future regulatory requirements, based upon current U.S. EPA regulatory 
proposals, or other requirements of the 1996 amendments to the Safe 
Drinking Water Act (SDWA). Compliance with the requirements of the Safe 
Drinking Water Act is difficult because there are 20 individual public 
water supplies serving the rural communities of the area. In each case, 
the small number of users served by individual system must bear the 
full cost of running the drinking water system. By joining together on 
a regional basis, future compliance costs will be associated with one 
intake and treatment facility, and they will spread amongst a larger 
user base. From the state's perspective, a regional system will show 
that the region has the capacity to operate, manage, and finance future 
operations.
    Insufficient water quantity is an everyday issue to many area 
residents of the area. Montana is in the fourth year of a severe 
drought. Though recent June rains have softened the blow of below 
normal snow pack, North Central Montana communities know severe drought 
will come again. The proposed source of supply, Tiber Reservoir, will 
provide both a high quality source of drinking water for the region and 
a firm supply of water that ``drought proofs'' the communities in this 
region. There is no other source in the region that has sufficient 
quantity and quality to meet the combined needs of all the communities 
in this region.
    What would a regional system cost in comparison to the alternatives 
that these community water supplies may have? The total estimated cost 
of the regional system is approximately $200 million. The State of 
Montana, as a condition of support, asked for an alternative analysis 
of the costs to communities and individuals of providing safe drinking 
water without a regional system. Based on engineering estimates, the 
cost of maintaining and operating 20 individual water systems within 
the region is about 10 percent lower than the $200 million cost of 
constructing the regional system. However, the benefits of a regional 
system greatly exceed the 10 percent increase in total cost for the 
regional project. First, the quality of water provided from the 
regional system will be a great improvement to many of the individual 
systems. If you have bad groundwater to start with, treatment doesn't 
improve its quality; it only makes it safe to drink. Second, 
maintaining the individual systems does not address the benefits of 
providing a reliable water supply that protects the communities against 
future drought.
    From a regulatory aspect a regional water system has significant 
benefits. At the present time, there are 20 different regulated systems 
within the region that wish to be a part of the authority. Meeting 
regulatory requirements of the Safe Drinking Water Act must be 
demonstrated by each system. When a rule changes, all those systems 
must react to the change. Also, because many of the systems are for 
small municipalities or county water districts, some with fewer than 
200 connections, there is a reduced capacity on the part of smaller 
systems to maintain and operate a water supply, not to mention the 
problems that long-established communities are having. That means that 
the Montana Department of Environmental Quality must perennially deal 
with problems of compliance. A regional water system would provide one 
point of regulation for all of the member systems. If a rule were 
changed, it would affect only one treatment plant. Due to economies of 
scale, a regional system can be efficiently operated with a higher 
level of oversight and management than individual municipal water 
supply systems. Yielding an expected increased degree of compliance.
    The state also supports this regional water system because of its 
potential to yield strong economic benefits. Unemployment on the 
Reservation is high. Construction will employ many people that have 
limited job opportunities. The construction period is estimated to be 
in excess of a decade. Once constructed, there will be long-term jobs 
created as the Tribe and the non-tribal water users operate and 
maintain the facilities. These types of jobs are highly sought after in 
this area of Montana. Finally, the regional pipeline will provide one 
of the key resources that enterprising businesses look for when they 
locate in an area--a safe water supply. This project will not resolve 
all of the economic problems that North Central Montana faces; however, 
it will serve as a cornerstone to future success upon which the people 
in the area can build.
    The state supports the Rocky Boy's/North Central Montana Regional 
Water System because it provides the Rocky Boy's Reservation with a 
safe and reliable drinking water system. The Rocky Boy's Reservation is 
the home of the Chippewa Cree Tribe in Montana. Since the establishment 
of the Rocky Boy's Reservation in 1916, tribal members have been 
limited to developing poor quality groundwater sources and limited 
surface water sources for their drinking water systems. The existing 
systems on the reservation are inadequate today and will not be able to 
provide safe drinking water for the future. The state of Montana 
supports every effort to provide the tribal members living on the Rocky 
Boy's Reservation a reliable, high quality drinking water system. We 
are all Montanan's and all of us must have the opportunity to prosper 
whether we live on an Indian Reservation or not. It is an absolute; the 
tribal members of the Rocky Boy's Reservation must have a safe and 
reliable drinking water system. The regional system will provide the 
required water supply for the reservation.
    Finally, I would like to tell the Committee about the legislation 
that Montana has passed to support this regional water system proposal. 
Clearly, considering the price tag of this project, a partnership 
amongst local, state and federal governments needs to be forged. 
Montana has made a commitment to this partnership. The Montana State 
Legislature established a funding mechanism in 1999 specifically to 
provide state cost share dollars for regional water systems. This fund 
has now grown to over $8 million and will continue to receive $4 
million a year until 2016. Earning from this fund will be used to match 
federal expenditures along with local cost share. The Treasure State 
Regional Water Fund Legislation enjoyed strong support from the State 
of Montana. In the Senate, S. 220 received 50 of 50 votes. In the 
House, S. 220 received 97 of 100 votes for passage.
    I respectfully request that the committee, after due consideration, 
pass S. 934 authorizing the Rocky Boy's/North Central Water System. 
This is so important to the people in North Central Montana that I ask 
on behalf of the State of Montana that you give this bill your 
approval, so that the planning and engineering can proceed on this 
system.
    Thank you. It is an honor to provide this statement to the 
committee.
                                 ______
                                 
                            Office of the Governor,
                                          State of Montana,
                                         Helena, MT, July 30, 2002.
Hon. Byron L. Dorgan,
Chairman, Subcommittee on Water and Power, Senate Committee on Energy 
        and Natural Resources, U.S. Senate, Washington, DC.

    Re: S. 934--Rocky Boy's/North Central Montana Regional Water System

    Dear Chairman Dorgan: Montana's Congressional delegation, working 
with the Chippewa Cree Tribe of the Rocky Boy's Reservation and the 
North Central Montana Regional Water Authority, has introduced 
legislation in the U.S. Congress for authorization of the Rocky Boy's/
North Central Montana Regional Water System. Development of this rural 
water project will bring a safe, ample supply of drinking water to the 
Rocky Boy's Reservation and to the surrounding region of North Central 
Montana.
    The State of Montana has supported the planning and administration 
of this regional water project with appropriations of nearly $350,000 
to date. For the current biennium, the 2001 Montana Legislature 
appropriated initial funding of up to $2.3 million for the state's 
portion of the non-federal cost share for regional water system 
construction.
    Drinking water supplies on the Reservation, in the surrounding non-
tribal communities, and for rural residences are both inadequate and of 
poor quality. Due, in part, to lack of safe and sufficient water 
supplies, economic activity in the region has been in a state of 
decline. The Chippewa Cree Tribe finds this unacceptable--members of 
their tribe need the opportunity to thrive and succeed, rather than 
facing a future that promises little more than a subsistence level of 
existence for the majority. Poor quality, unsafe drinking water is no 
more desirable in this area than anywhere else. The proposed regional 
drinking water system is critical to the future of North Central 
Montana.
    As a Senator from a western state, I know that you appreciate the 
importance in regard to the needs of Montana's Indian Reservations and 
rural communities. Your subcommittee's support is critical for the 
success of this project and the long-term viability of North Central 
Montana economy.
    I would appreciate the support of your subcommittee for S. 934, the 
legislation to authorize this vital project. This regional water supply 
system will greatly improve the quality of life on the Rocky Boy's 
Reservation and to North Central Montana.
            Sincerely,
                                                Judy Martz,
                                                          Governor.
                                 ______
                                 
                      National Water Resources Association,
                                      Arlington, VA, July 29, 2002.
Hon. Gordon Smith,
U.S. Senate, Russell Senate Office Building, Washington, DC.
    Dear Senator Smith: On behalf of the Board of Directors and 
membership of the National Water Resources Association (NWRA), I am 
writing to voice our support for your legislation, the Small 
Reclamation Water Resources Act of 2001 (S. 1882).
    As water users in Oregon and the 16 other Western States, our 
members understand the importance of conserving our limited water 
supplies. S. 1882 would improve and reauthorize the Small Reclamation 
Project Loan Program that was discontinued during the previous 
Administration. The legislation provides both loans and grants to 
assist irrigation districts, municipalities and other water related 
organizations to develop and implement water conservation, water 
quality improvements, water management for urban landscapes, drought 
assistance, fish and wildlife improvements as well as public safety 
project improvements.
    Our members found the previous Small Reclamation Project Loan 
Program to be very helpful in resolving difficult water supply 
problems. S. 1882 maintains the utility of the program while adding 
flexibility to address our current and future water challenges.
    Passage of this legislation will greatly aid in the development and 
expansion of local water programs in California and the other 
Reclamation states.
    Once again, NWRA supports S. 1882 and we look forward to assisting 
you and your staff in building support for this needed legislation.
            Sincerely,
                                        Thomas F. Donnelly,
                                          Executive Vice President.
                                 ______
                                 
                  Association of California Water Agencies,
                                     Sacramento, CA, July 29, 2002.
Hon. Gordon Smith,
U.S. Senate, Russell Senate Office Building, Washington, DC.

Re: Support of the Small Reclamation Water Resources Act of 2001 (S. 
1882)

    Dear Senator Smith: The Association of California Water Agencies 
(ACWA) supports your Small Reclamation Water Resources Act of 2001 (S. 
1882). As you know, ACWA represents over 440 water districts throughout 
the state who collectively deliver over 90 percent of California's 
agricultural, residential and industrial water supplies. Passage of 
this legislation will greatly aid in the development and expansion of 
local water programs in California and the other Reclamation states.
    ACWA supports this legislation because the grants and loans it 
makes available to agencies allows them to develop projects that 
promote efficient water use, develop new water supplies, and enhance 
the environment within their service areas. This program promotes state 
and local participation in small Reclamation projects that will provide 
local benefits.
    ACWA is pleased to support S. 1882 and appreciates your leadership 
on Western water issues.
            Sincerely,
                                         David L. Reynolds,
                                     Director of Federal Relations.
                                 ______
                                 
                       Idaho Water Users Association, Inc.,
                                         Boise, ID, August 6, 2002.

Subcommittee on Water and Power, Senate Committee on Resources, Hart 
        Senate Office Building, Washington, DC.

Re: S. 2556--Fremont-Madison Conveyance Act

    Dear Mr. Chairman: This letter is provided on behalf of the Idaho 
Water Users Association (IWUA) in support of S. 2556, the Fremont-
Madison Conveyance Act. IWUA represents more than 300 irrigation 
districts, canal companies, water districts, public water suppliers, 
municipalities, hydropower interests, aquaculture companies, 
agribusinesses and individuals. We are dedicated to the wise and 
efficient development and use of water resources. IWUA represents over 
two million acres of irrigated land and is affiliated with both the 
National Water Resources Association and the Family Farm Alliance. IWUA 
is proud to count Fremont-Madison Irrigation District among its many 
members.
    IWUA has strongly supported previous title transfer legislation for 
its members, including Burley Irrigation District and Nampa & Meridian 
Irrigation District. Of course, both of these bills were approved by 
Congress and signed by the President. We commend Senator Crapo for 
introducing S. 2556 and Senator Craig for cosponsoring the bill. We 
strongly urge your subcommittee to give the legislation favorable 
consideration.
    IWUA adopted the attached resolution at its Annual Conference in 
January, 2002, expressing support for Fremont-Madison's proposed title 
transfer. We request that this letter of support and IWUA's resolution 
be included in the official hearing record as the subcommittee 
considers the bill. Thank you.
            Sincerely,
                                         Norman M. Semanko,
                            Executive Director and General Counsel.
[Attachment]

      Resolution No. 2002-14--Fremont-Madison Irrigation District 
                             Title Transfer

    WHEREAS, Fremont-Madison Irrigation District (Fremont-Madison) is 
involved in a process to obtain the transfer of the legal title of 
portions of certain physical facilities used by Fremont-Madison, 
namely: the Cross Cut Diversion Dam, the Cross Cut Canal, the five (5) 
developed wells drilled pursuant to Idaho Water Permit 22-07022 and the 
assignment of said permit, all of which property rights are presently 
held by the United States, Bureau of Reclamation (Bureau); and
    WHEREAS, Fremont-Madison is also working with the Bureau to 
complete the administrative process for the title transfer and is 
drafting a bill to convey the said facilities to Fremont-Madison for 
introduction in the Congress of the United States; and
    WHEREAS, Fremont-Madison has controlled, managed, operated, and 
maintained the said facilities with permission and direction from the 
Bureau at all times since they were constructed.
    NOW, THEREFORE, BE IT RESOLVED, That the Idaho Water Users 
Association supports Fremont-Madison in their effort to acquire legal 
title from the United States to the Cross Cut Division Dam, the Cross 
Cut Canal, the five (5) wells developed under Permit 22-07022, together 
with the right to further develop wells under Permit 22-07022, but only 
pursuant to a plan which mitigates for injury of all irrigation water 
users and which is approved by the Idaho Department of Water Resources.
                                 ______
                                 
                           The Henry Fork Foundation, Inc.,
                                         Ashton, ID, July 29, 2002.
Honorable Senators,
Energy and Natural Resources Committee, Water and Power Subcommittee, 
        U.S. Senate, Washington DC.

Re: S. 2556--Fremont-Madison Conveyance Act

    Dear Honorable Senators: The Henry's Fork Foundation (HFF) sends 
this letter on behalf of our approximately 2,000 members who are 
dedicated to protecting the Henry's Fork watershed. The HFF mission is 
to ``understand, protect, and restore the unique values of the Henry's 
Fork River while doing so in the context of mutual respect for others 
that live and work in the watershed to ensure solutions are 
sustainable.'' In the context of both protecting the magnificent 
Henry's Fork fishery and mutual respect for others who live and work in 
the watershed, we submit the following comments regarding S. 2556. 
Because the current version of this bill for the most part mirrors 
companion legislation--H.R. 4708--in the House of Representatives, many 
of our comments and suggestions are identical to those the HFF 
submitted prior to the hearing on that bill.
    The HFF has collaborated on difficult resource issues for the past 
decade with the Fremont-Madison Irrigation District (FMID) and other 
stakeholders in the Henry's Fork watershed. We were the only 
conservation group--local, state, regional, or national--willing to sit 
down and have substantive talks and negotiations regarding earlier 
title transfer legislation involving Island Park Reservoir and the 
various ways to protect the fishery resource while still meeting the 
irrigation community's needs.
    With the collaborative nature of our past involvement in title 
transfer issues in mind, the HFF wants to reiterate once again our 
position regarding the transfer of title of federal reclamation dams, 
canals, or any other type of irrigation works in the Henry's Fork 
watershed. The HFF believes that any type of title transfer legislation 
should have an environmental component to ensure that the Henry's Fork 
fishery resource is not only protected but also enhanced.
    The HFF also wants to emphasize that we are cognizant of the dry 
year water issues for the irrigation community in the Henry's Fork 
watershed. Recent conversations with Dale Swensen and FMID have helped 
frame these issues. The fact that the irrigation district--based on 
Minidoka Project storage and operations--has only been allocated 62% 
and 42% of Island Park Reservoir storage during the last two drought 
years is illustrative of the need for supplemental irrigation water for 
FMID users. Further, such dry year realities emphasize the nexus 
between water storage rights (i.e., who actually owns the water) in the 
upper Snake River Basin and federal Bureau of Reclamation (BOR) 
operations during such years. In other words, during a dry year or 
drought cycle reduced stream flows during the winter months are 
inexplicably tied to broader system-wide BOR Minidoka Project 
operations and reservoir carryover, and not FMID rights or operations. 
These are classic dry year dilemmas that occur as foreseeable events 
almost every decade for a 2-3 year period.
    But fishery needs during drought years and cycles mirror those of 
the irrigators. The impact of such low flow years on the fishery 
resource in the Henry's Fork watershed is undeniable. Such impacts have 
been documented by numerous studies funded and carried out by the HFF 
and Idaho Department of Fish and Game (IDFG) highlighting the 
connection between low flows and the loss of spawning and rearing 
habitat, juvenile mortality, year-class strength, the loss of 
macrophyte habitat, and overall stream health. There is also the 
chance--depending on project operations--that Island Park Reservoir 
will reach such low levels that unnaturally high levels of sediment 
will be released downstream. These are enormously significant fishery 
concerns, but there is an economic fall-out as well. An economic study 
funded and completed by the HFF and published in the Intermountain 
Journal of Sciences in 2000 estimated the total annual value of the 
Henry's Fork fishery only between Island Park Dam and Hatchery Ford at 
$5,012,509.
    So with these dry year irrigation and fishery needs in mind, the 
HFF provides the following comments regarding a piece of legislation 
that aims to only provide for one piece of the overall economic well-
being and no mention of the ecological health of the Henry's Fork 
watershed. We have tried to break our concerns with the title transfer 
legislation into two specific categories. First, the HFF has a number 
of specific concerns regarding the current proposals and we have 
outlined those comments below. Second, we have some other policy and 
resource related concerns specific to the portion of the title transfer 
legislation pertaining to the Teton Wells. Finally, the HFF would like 
to reiterate some of the fishery resource needs in the Henry's Fork 
watershed, and advocate that the Idaho congressional delegation take 
the lead in getting a number of diverse stakeholders together to design 
a mutually agreeable and long-term solution to drought year problems in 
the upper basin.

Specific Comments Regarding S. 2556
    1. The ``shall'' language contained in Section 3 leaves the 
Secretary no flexibility regarding the transfer of the federal assets 
described in the bill based on further environmental or any other type 
of analysis. This establishes bad precedent, doesn't give the federal 
government the necessary flexibility to avoid possible impacts to other 
water user contacts or obligations or the environment, and 
predetermines a course of action that may not be in the public 
interest.
    2. The HFF does not have any specific comments regarding the 
language in Section 2 regarding the Teton Exchange Wells. However, see 
the section below for our comments regarding the extraordinarily 
important resource issues concerns associated with the future use of 
the Teton Exchange Wells. In addition, the FMID has stated both in 
meetings and in public statements that the use of additional wells will 
be capped at approximately 80,000 acre/feet to provide supplemental 
water for its users. However, there is no explicit cap of the proposed 
additional use in the legislation.
    3. Nothing in S. 2556 elaborates on the scope of the NEPA process 
related to title transfer activities. The proposed legislation should 
be expanded to identify specific issues to be assessed and analyzed in 
the NEPA process. Such issues include the possible impacts to existing 
surface and groundwater rights, diminished flows in the Henry's Fork 
between the point where water is diverted to fill the Cross Cut Canal 
and where well discharges would enter the river, and other impacts to 
temperature and other water quality parameters and aquatic habitat in 
the lower Henry's Fork watershed.

The Teton Exchange Wells
    The Teton Exchange Wells and the current and possible future water 
use associated with State of ldaho water permit #22-7022 provide the 
centerpiece for the proposed title transfer legislation. The original 
permit for these wells envisioned 45 wells totaling 670 cfs of water. 
However, to date only five wells have been drilled, providing 
approximately 81 cfs. During last year's drought season, the FMID used 
these wells to provide approximately 26,000 acre/feet of water to their 
users. The HFF concerns regarding the use of the Teton Exchange Water 
echo those of other stakeholders such as IDFG and the Upper Snake River 
Cutthroats Chapter of Trout Unlimited. From our perspective there are 
more questions than answers regarding the transfer of these wells.
    These concerns include regulatory issues pertaining to the 
relationship between the future use of additional wells and the current 
moratorium on new groundwater permits in the Upper Snake River Basin, 
the conjunctive management of surface and groundwater use in the State 
of Idaho, and aquifer recharge. Most importantly from a river health 
standpoint, the use of the additional water could have a deleterious 
effect on the Henry's Fork River. The location of the new wells, the 
amount of water pumped from the existing and new wells, the type and 
location of deliver systems, location of water use, and return flows 
all have implications for fish and wildlife resources. Finally, there 
has been very little substantive talk regarding the use of some of the 
well water as an exchange mechanism to provide water during strategic 
time periods in the Henry's Fork system from Henry's Lake downstream 
and benefit fish and wildlife resources.

The Henry's Fork Fishery
    Perhaps the biggest disappointment regarding the current title 
transfer legislation is that there was no attempt to include broader 
stakeholder representation to develop a global remedy--i.e., a drought 
management plan--to meet not only FMlD needs but also chose of the 
fishery. Neither the HFF nor the Henry's Fork Watershed Council has 
been part of this process. We have been forced into a corner regarding 
our stance on the current proposal; that is not where we prefer to be. 
The HFF made a commitment years ago to work whenever possible with 
irrigators and others in the watershed to develop innovative solutions 
to difficult natural resource problems. We remain committed to this 
type of approach.
    At the same time, perhaps the most important resource issue for the 
HFF's constituency now and for the foreseeable future will be water. We 
have yet to solidify a long-term drought response plan in the Henry's 
Fork watershed that adequately protects the fishery and aquatic 
resources. This void includes the lack of statutory, regulatory, or 
negotiated mechanisms to guarantee that sediment events are avoided, 
minimum winter flows established, and late-summer water quality effects 
remedied. Therefore, in addition to our consistent approach to 
collaboration in the watershed, the HFF also remains committed to 
finding creative solutions to the aforementioned water and fishery 
issues.
Conclusion
    The HFF would like to request that the current legislative proposal 
be delayed while the various stakeholder groups are convened to see if 
there might be an alternative that meets everyone's needs. The Idaho 
congressional delegation could help sponsor and facilitate talks that 
should include everyone who has a stake in the outcome from Twin Falls 
upstream. The HFF believes it is the ultimate irony that the federal 
government spends millions of dollars annually on a hatchery driven 
anadromous salmon and steelhead fishery in the lower river while some 
of the world's greatest wild and native trout fisheries--Idaho 
fisheries--dry up every ten years. The current title transfer approach 
should he broadened to include a more comprehensive fix to drought year 
water issues. We believe that legislation can be developed that meets 
everyone's needs.
    The HFF appreciates the opportunity to comment regarding S. 2556 
and the important water use and natural resource issues addressed 
therein. Please don't hesitate to call our office with any questions or 
continents.
            Sincerely,
                                            Scott B. Yates,
                                        Interim Executive Director.
                                 ______
                                 
                                           Trout Unlimited,
                                      Arlington, VA, July 29, 2002.
Hon. Byron L. Dorgan,
Chairman, Water and Power Subcommittee, Committee on Energy and Natural 
        Resources, U.S. Senate, Washington, DC.

    Re: S. 3556--Fremont-Madison Conveyance Act

    Dear Senator Dorgan: On behalf of Trout Unlimited, I am writing in 
regards S. 2556, the Fremont-Madison Conveyance Act. I request that you 
include this letter in the record of the hearing on July 31, 2002 on 
this bill.
    The mission of Trout Unlimited is to conserve, protect and restore 
North America's trout and salmon fisheries and their watersheds. Trout 
Unlimited is a private, non-profit organization with 130,000 members in 
450 chapters nationwide. There are approximately 2,000 TU members in 
Idaho, many of whom enjoy the diverse and outstanding fishery resources 
of the Henry's Fork watershed. I work with TU's Western Water Project, 
which focuses on water quantity issues around the West. Across the 
West, even in normal water years, but especially in drought years like 
this one, rivers are routinely drained dry--a condition that is 
disastrous for fish, anglers and local economies that depend on water-
based recreation.

                              INTRODUCTION

    Citing Mark Twain's hoary aphorism about whiskey, water and 
fighting seems required in every hearing about western water, because 
there is a measure of truth in it. But in some parts of the West, 
people have grown up, and gotten beyond the endless opportunities for 
fighting. Instead, they are working together to solve problems, rather 
than simply win a round.
    In Idaho, a group of stakeholders on the Henry's Fork of the Snake 
River, acting through the Henry's Fork Watershed Council, have a 
remarkable history of collaboration and compromise on difficult 
resource issues extending back for two decades. The Fremont-Madison 
Irrigation District (FMID) is a leader in the Watershed Council; Trout 
Unlimited's members and local chapter have been significantly engaged 
as well.
    Trout anglers have greatly appreciated this progress because the 
Henry's Fork is justifiably famous for its remarkable trout fishing--
with large numbers of huge, fat, and smart wild rainbow trout. TU 
members voted it the best fishing in the country, and ranked it number 
one in TU's Guide to America's 100 Best Trout Streams. Anglers are not 
the only beneficiaries of this fabulous fishing. An economic study 
funded and completed by the Henry's Fork Foundation (HFF) and published 
in Intermountain Journal of Sciences in 2000 estimated the regional 
economic benefit of only a portion of the Henry's Fork fishery to be in 
excess of $5 million per year.
    The issues the Watershed Council members have worked through 
sometimes have been tough. Upstream of the main fishing section of the 
Henry's Fork, is Island Park Reservoir, a part of the Bureau of 
Reclamation's Minidoka Project, and a principal water supply for FMID. 
In 1992, Reclamation drew down Island Park Reservoir--to the point that 
50,000 tons of sediment was released, blanketing the river with silt 
and causing a disaster for aquatic life and the fishery. When the 
possibility of again drawing down the reservoir and releasing silt 
loomed last year due to drought conditions the HFF, FMID, Trout 
Unlimited and Reclamation reached agreements that avoided repeating 
that problem.
    That history of successful collaboration has not yet, however, been 
extended to transferring title to Bureau of Reclamation facilities. The 
Henry's Fork Foundation and the Fremont-Madison Irrigation District 
(FMID) had prolonged, substantive and productive negotiations regarding 
an earlier title transfer proposal for Island Park Reservoir and the 
various ways a transfer could serve to protect the fishery resource 
while still meeting the irrigation community's needs. Trout Unlimited 
was a strong public and private supporter of those efforts. That the 
effort foundered is proof of just how complex and potentially 
contentious this transfer of public resources into the hands of 
irrigation districts is, both on the Henry's Fork and elsewhere.

                        TRANSFER POLICY APPROACH

    Trout Unlimited agrees with the premise that the federal government 
need not own all of the 600-plus Reclamation projects. However, 
spinning off parts of the Reclamation system to nonfederal ownership 
makes policy sense only if the transfers protect and enhance the public 
benefits associated with the projects. America's taxpayers, people in 
the East, West, South, and North paid for these projects. Only if a 
transfer of ownership of these public projects serves to increase the 
public benefits and to solve the pressing problems in managing the 
West's water for economic needs as well as environmental, recreational, 
and aesthetic purposes, should it be accomplished.
    The approach we advocate has four main points:

Transfers Should Enhance the Public Benefits of the Project and the 
        Associated River System
    Our fundamental position is that title transfers make sense only if 
the human and environmental systems associated with the water projects 
are made better because of transfer. During most of the long history of 
western water projects, environmental damage was simply taken as a 
matter of course, with predictable results. One can hardly consider a 
major water project now without stumbling over an endangered species 
issue.\1\
---------------------------------------------------------------------------
    \1\ In the inter-mountain West, 8 trout subspecies are endangered 
or threatened. Twenty species of Western fishes are now extinct. A 
hundred more fish species are threatened or endangered--in total, 70% 
of all native fish species west of the Rocky Mountains are extinct or 
at risk. Over 300 runs of Pacific salmon and steelhead are at risk of 
extinction or already gone.
    The presence or possible presence of protected threatened and 
endangered species creates significant complexity in a transfer. ESA 
Section 7, which applies only to federal actions, prohibits jeopardy to 
a species. Non-federal entities are not subject to Section 7, but 
rather to Section 10, which prohibits ``take'' of the species. Because 
Section 7 is significantly more stringent, transferring ownership of a 
project from Reclamation to a water district effectively reduces the 
level of protection afforded a listed species. Crafting transfer terms 
that reflect this change in legal status is complex, and requires 
substantial information, public and agency involvement, and careful 
balancing.
---------------------------------------------------------------------------
    We can take Twain's approach and continue a century and a half of 
fighting--eventually somebody may win; however, history shows that the 
likely outcome is simply more fighting. Or we can take the modern 
approach and ensure that an action, in this case transfer of ownership, 
that benefits one set of interests, water users, also enhances the 
public benefits of the project and the associated river system.
Some Federal Water and Power Projects Should Remain Federal
    Projects that play critical roles in watershed and river management 
for public purposes or are important to interstate, international, or 
treaty obligations, should remain federal. Some projects are simply too 
important to be able to adequately condition the transfers. For 
example, projects such as Hoover Dam/Lake Mead and Glen Canyon Dam/Lake 
Powell simply should remain federal.
    As a corollary to the first principle, where public benefits cannot 
be ensured and enhanced in a transfer, because adequate terms cannot be 
crafted or the recipient will not accept the conditions, the project 
should remain federal.

Water Users Are Not Entitled to Project Ownership; Transfer Is a New 
        Benefit To Be Negotiated and for Which Consideration Is 
        Appropriate.
    Under the Reclamation laws, water users are in no sense entitled to 
project ownership when they complete their capital repayment 
obligations. The law and history are unambiguous on the point. ``Paid 
out'' does not mean ``paid for.''
    Under Reclamation law, agricultural water users are obligated to 
pay only pennies on the dollar of the costs for Reclamation 
projects.\2\ While water districts may argue they are due ownership 
when they complete payments, there is no legal claim that those 
payments built equity. In fact, because the projects were almost 
entirely subsidized with public funds, the argument in favor of 
enhanced public benefits is much stronger than any argument in favor of 
water user ownership. If water users are given a new benefit--ownership 
and complete control of the facilities--the quid pro quo should be 
enhanced public benefits.
---------------------------------------------------------------------------
    \2\ The economics of water projects make nonsense of the notion 
that water users have in any sense ``bought'' the projects. Since 1914, 
the federal taxpayer has paid for from 40% to more than 90% of 
irrigation project costs simply due to the no-interest repayment terms. 
On top of that generous subsidy, irrigation water users have had more 
than half (53%) of their $7.1 billion irrigation share of water project 
costs shifted to hydropower users or simply forgiven. (Information on 
Allocation and Repayment of Costs of Constructing Water Projects, GAO/
RCED 96-109, 1996.)
---------------------------------------------------------------------------
A Decision To Transfer a Project Should Not Be Made Until the 
        Consequences of Transfer Are Understood and the Terms of 
        Transfer Determined
    Because water projects affect so many interests, the terms of the 
deal determine whether a transfer is in the public interest. Congress 
requires that water projects proposed for construction be evaluated, 
and at least the general outline of the project determined, before 
considering projects for authorization. Congress should do no less in 
disposing of projects in which it has already invested the taxpayers' 
money.
    We suggest that Congress require environmental review and facility-
specific transfer plans that set the terms and conditions be completed 
prior to legislative action. As a less attractive alternative, Congress 
could authorize transfers while also directing the Secretary of the 
Interior to condition transfers in order to protect and enhance the 
public benefits. The appropriate time for legislation and the language 
used in that transfer legislation has been an issue since the topic of 
granting ownership to water users first arose. When transfers are 
directed before environmental review has been completed, Congress is 
deprived of a thorough analysis of the transfer issues and interior's 
ability to seriously consider the ``no action'' alternative is 
eliminated. Similarly, when transfer is directed before the terms of 
the deal are worked out, Interior's ability effectively to condition 
the transfer to protect the public interest and enhance public benefits 
is greatly reduced, if not eliminated.
    Please note that conservation organizations are not alone in their 
concern about terms and prior review. The Western States Water Council 
whose members are appointed by Western governors arrived at very 
similar conclusions in twice adopting a position on transfers of 
federal water and power projects. In 1995, and again in 1998, the WSWC 
adopted a position on transfers that sets out their concerns with third 
party impacts, public costs and benefits, the change in applicable 
laws, and the need for a strong role for states. They urge Congress and 
the Administration to adopt a process and develop criteria and 
guidelines for project-by-project review of transfer proposals, with 
significant state involvement. (See Position No. 209 at http--//www--
westgov.org/wswc/transfer.html). Trout Unlimited agrees with this 
position.

                                S. 2556

    HFF and TU appreciate that FMID faces a serious problem with the 
drought year reliability of its Reclamation water supply because the 
fishery faces the same problem. The principal reservoir FMID relies 
upon is Island Park, part of Reclamation's Minidoka Project, and the 
subject of the prior title transfer effort. During the last two drought 
years, FMID has only been allocated 62% and 42% of Island Park 
Reservoir storage because of the senior rights of other Minidoka 
Project contractors. Unfortunately, these dry years are all too common, 
and typically occur two or three years out of every ten. Every water 
user on the Snake River and the Minidoka project, including the 
fishery, faces the same set of problems.
    The centerpiece of this bill is transfer of a partially developed 
well field. Teton Exchange Wells and the associated State of Idaho 
water permit #22-7022. While the permit envisioned 45 wells totaling 
670 cfs of water, only five wells have been drilled, providing 
approximately 81 cfs. FMID has stated its intent to firm its water 
supply by drilling new wells and making more extensive use of the well 
field.
    Our immediate concern is that additional water extraction from the 
ground water system will have a deleterious effect on the Henry's Fork 
River and aquatic resources. The location of the new wells, the amount 
of water pumped from the existing and new wells, the type and location 
of delivery systems, location of water use, and return flows all have 
implications for fish and wildlife resources. We understand that other 
water users have concerns about possible injury to their rights as 
well. TU must oppose this legislation because of the uncertain, but 
likely, impact further development of this well field would have on the 
Henry's Fork aquatic resources.
    Our more fundamental concern is one of missed opportunity. The 
Henry's Fork needs a drought management plan that addresses the needs 
of the agricultural community, the angling interests that now are a 
significant part of the local economy, and the ecological needs of the 
river. This bill transfers a potential significant source of water, 
usable in dry years, to one of the many interests on the river. It 
picks one set of interests as a winner, and ignores the others. A 
drought management plan could use any new water developed in the well 
field as a key element in responding to the inevitable periodic dry 
years. This bill represents an approach to water problems from the last 
century, one that Mark Twain would recognize. The Henry's Fork needs an 
approach based on collaboration, communication, and a philosophy of 
shared pain and shared gain. Additional use of the Teton Exchange Wells 
may be an integral part of that approach to making an already stressed 
water system work more effectively and provide greater benefits to all 
the users.
    TU requests that the current legislative proposal be deferred while 
the various stakeholder groups are convened to see if there might be an 
alternative that meets everyone's needs. Such talks could be sponsored 
and facilitated by the Idaho congressional delegation and include those 
with a stake in the outcome from Twin Falls upstream. The members of 
the Henry's Fork Watershed Council have demonstrated that they can be 
effective and work productively if given the opportunity. Missing this 
opportunity to encourage creating an effective drought management plan 
would be moving in the wrong direction.
    We have the following specific comments on S. 2556:
    1. Section 2(3) creates some ambiguity in the facilities to be 
conveyed. Section 2(3)(a) describes the facilities to be transferred 
specifically as the Cross Cut Diversion Dam, the Cross Cut Canal, and 
the Teton Exchange Wells. However, subsection (3)(b) of Section 2 is 
broader and includes broader language describing the transfer of all 
United States rights, title, and interest ``any canal, lateral, drain, 
or other component of the water distribution and drainage system that, 
on the date of enactment of this Act, is operated or maintained by the 
District to deliver water to and drainage of water from land within the 
boundaries of the District.'' We understand that FMID may operate other 
facilities beyond those specified in Section 2(3)(a). Therefore, we 
suggest that the facilities to be transferred be identified in Section 
2(3)(a) specifically and not generally.
    2. Section 2(3)(c), concerning the Teton Exchange Wells, makes 
clear that FNUD would receive not just the five wells it has been 
using, but also the permit for 40 additional wells and approximately 
589 cfs of additional water. The heart of our concern is the transfer 
of this permit, and the possible development of some or all of the 
additional diversions, with attendant effects on aquatic resources.
    3. Section 3(a) directs transfer of the facilities by a date 
certain. Directing transfer limits, and may eliminate the ability of 
the Secretary to effectively negotiate terms and conditions in response 
to the eventual NEPA and ESA process, reducing the value of a review 
process subsequent to legislation. Directing a transfer is appropriate 
in legislation after the environmental review is complete, and the 
terms of the transfer have been set through negotiation. Prior to 
reaching that point, a much better result is likely if the transfer is 
authorized, but not directed.
    4. Section 3(b) specifies the cost to FMID of the transaction and 
the facilities. We reiterate the common-sense position set out above 
that ``paid out'' does not mean ``paid for.'' The asset value to the 
taxpayer of the transferred facilities has not been established and 
should be in the course of a thorough review of the transfer proposal 
and development of a drought management plan; after determining that 
value, a reasonable price can be set. Section 3(b)(1)(B) sets an 
arbitrary cap of $280,000, to the potential detriment of the federal 
taxpayer. We also are concerned that Section 3(b)(2)(B) in limiting the 
transaction costs to FM1D may be setting a cap on any mitigation or 
environmental enhancement costs that could be required as part of the 
transfer. Until that assessment is done, the environmental costs cannot 
be quantified and should not be capped. Further, the $40,000 cap on 
administrative payments again sets an arbitrary cap, to the detriment 
of the federal taxpayer.
    5. Section 5 calls for NEPA analysis to be performed after Congress 
directs transfer. This process seriously limits the scope of NEPA 
review (by essentially eliminating the no transfer alternative from 
serious consideration) and greatly limits the ability of the Secretary 
to require terms and conditions that protect public resources. We 
suggest that at a minimum the legislation or legislative record make 
clear that NEPA analysis is to consider thoroughly the effects of 
development of the Teton Wells.
    6. Section 5 is intended to legitimize use of Reclamation water on 
land not currently eligible for that water. Water spreading is a 
significant issue around the West that has typically been resolved, as 
in this case, by legitimizing what amounts to use of water contrary to 
law. While we do not have information about this particular situation, 
we note that the effect of this section is to expand the number of 
acres legally eligible for irrigation in a basin chronically short of 
water.

                               CONCLUSION

    Congress and Reclamation are far from solving the problem of how, 
when and under what conditions to transfer ownership of federal water 
projects. In part, this is because each project is different, with 
different users, beneficiaries, and environmental issues. Therefore, 
the appropriate terms and conditions for transfer will differ from 
project-to-project as well. We suggest that the best approach parallels 
that which Congress follows when authorizing water projects. Congress 
should require facility specific transfer plans that develop the issues 
and find solutions before legislation is enacted. Just as with 
feasibility studies for new projects, results are best when the 
questions are asked, the public is involved, and the answers are found 
early in the process. And as recent revelations about the Corps of 
Engineers practices show, even that process is subject to flaws.
    The development that we find most appealing is that in some areas 
water users and conservation organizations are now actually talking to 
one another about how to manage rivers for their mutual benefit. The 
Henry's Fork is home to leaders in this approach, and their efforts 
should be encouraged. We are very optimistic that common ground can be 
found in many, if not most cases. The wisest of the Reclamation 
contractors appreciate their rights and responsibilities as stewards of 
vital natural resources, just as conservationists appreciate the 
contributions of water users.
    Congress' goal should be to improve the benefits derived from the 
enormous federal investment in western water resources. To be satisfied 
with the status quo in a deteriorating and increasingly complicated 
system is not enough. Congress should only transfer Reclamation 
projects when it leads to human and environmental systems that are 
stronger, healthier and more resilient. We oppose S. 2556 because it 
does not yet meet that test.
            Very truly yours,
                                            Steven Malloch,
                                              Trout Unlimited, Inc.
                                 ______
                                 
                                           Trout Unlimited,
                                    Idaho Falls, ID, July 27, 2002.

Honorable Senators of the Energy and Natural Resources Committee, and 
    the Water and Power Subcommittee, U.S. Senate, Washington, DC.

Subject--S. 2556, Fremont-Madison Conveyance Act

    Honorable Senators: The Snake River Cutthroats, an Idaho Falls-
based chapter of both Trout Unlimited and the Federation of Fly 
Fishers, representing over 200 members in eastern Idaho, offer these 
comments on the bill, S. 2556, ``Fremont-Madison Conveyance Act.''
    The passage of this bill and its companion House bill, H.R. 4708, 
is opposed by the Snake River Cutthroats by unanimous vote of the Board 
of Directors. We are very disappointed in the actions of the Fremont-
Madison irrigation District in causing this legislation to be 
introduced without the partnership of the conservation community and 
other stakeholders. We ask you to place this bill on hold until 
language can be crafted by the stakeholders that is supported by both 
the agricultural and conservation communities, or at a minimum, 
consideration is given to the needs of the fishery and aquatic 
resources.
    This bill represents a serious failure in leadership, a lost 
opportunity for the agriculture and conservation community to provide a 
showcase example of cooperation and partnership. During drought years 
we both suffer the same problem, inadequate supply of water. However, 
the remedy is at hand, the Teton Exchange Wells and associated water 
pumping permit now owned by the people of the United States. This 
permit, with existing and future wells, exceeds the needs of both 
parties. Working together, we could be a formidable force for improving 
the welfare of our agricultural and conservation interests, and their 
associated contributions to the local economy.
    Unfortunately, Fremont-Madison has chosen to grasp for the prize 
alone, without consultation with the other stakeholders, without 
discussions within the framework of the Henry's Fork Watershed Council 
on the language of the bill, or provisions for the health of the 
watershed, and without regard for the procedures outlined in the 
``Framework for the Transfer of Title,'' Bureau of Reclamation. 
Fremont-Madison proposed paying 5280,000 for wells and water permits 
conservatively valued at 12 times that. by the Bureau of Reclamation, 
and in actuality multiples of this. Surely, there must be room for a 
bit of sharing with the aquatic resources.
    The Snake River Cutthroats respectfully make these requests of and 
comments to the Senate Energy and Natural Resources Committee, and of 
the Water and Power Subcommittee:

          1. Please send this bill, S. 2556, back to its sponsors, or 
        place on hold, with instructions to include all stakeholders 
        including the conservation community, in its formulation, and 
        return with a ``do pass'' recommendation from the Henry's Fork 
        Watershed Council. Failure to do so will undoubtedly seriously 
        damage the legitimacy of and the climate of cooperation and 
        goodwill, so carefully developed by that council.
          2. Fremont-Madison, for their own reasons, is trying to 
        acquire title without following the procedures outlined in 
        ``Framework for the Transfer of Title,'' August 7, 1995, Bureau 
        of Reclamation. This procedure calls for NEPA analysis to be 
        performed before introduction of legislation to title transfer. 
        This approach seriously limits the effectiveness of the NEPA 
        review, and the ability of the Secretary of the Interior to 
        provide mitigation, and to require terms and conditions to 
        protect public resources. We believe that, at a minimum, the 
        bill should first require completion of the NEPA analysis, and 
        agreement to any necessary remediations prior to title 
        transfer.
          3. At a minimum, provide in the bill that some portion, (we 
        suggest 20%) of the water from the Teton Exchange Wells and of 
        the associated permit be reserved for the benefit of the 
        fisheries and welfare of the aquatic wildlife.
          4. There may be testimony suggesting that water produced from 
        the wells will result in increased flows in the river, thus 
        providing the conservation benefit. Our analysis does not agree 
        with that, It is logical that the maximum summer irrigation 
        flows through the length Henry's Fork river would come if all 
        the water stored in the upper river is flowed to water right 
        holders over 50 to 150 miles downstream. And in drought years 
        these downstream users do acquire rights to that storage water, 
        amounting to over 50% this year. The Teton Exchange wells are 
        located in the lower portion of the District, thus water from 
        storage and natural flows belonging to these downstream water 
        users but diverted by Fremont-Madison in the upper district, 
        and replaced in the lower located wells, will actually decrease 
        flows in that river segment. And it is unexpected that it is 
        economically feasible for Fremont-Madison to fund the estimated 
        $100,000-200,000 lifting costs to hold additional water in the 
        reservoirs for winter flow supplementation for the fisheries 
        and aquatic resources.

    The Snake River Cutthroats appreciate this opportunity to submit 
comments on S. 2556.
            For the Snake River Cutthroats,
                                             James Mathias,
                                                         President.
                                 ______
                                 
                              Western States Water Council,
                                        Midvale, UT, July 26, 2002.
Hon. Jeff Bingaman,
Chairman, Committee on Energy and Natural Resources, U.S. Senate, Hart 
        Senate Office Building, Washington, DC.
    Dear Chairman Bingaman: On behalf of the Western States Water 
Council, representing the governors of eighteen states, I am writing to 
express our interest in legislation dealing with the conservation and 
management of the High Plains Aquifer. As you know, the Council serves 
as a forum for western states to express their views on water resource 
issues. Several of our member states have determined to use the Council 
as a vehicle to address their interests in protecting the High Plains 
Aquifer and have formed a caucus that is meeting in conjunction will 
our regular Council meetings to discuss issues of mutual concern.
    To date, those discussions have revolved around the continuing need 
for conservation of High Plains ground water resources and the likely 
impact of incentive programs enacted as part of the Farm Bill. We have 
also addressed the need for further legislation and welcome the 
introduction of S. 2773. Good decisionmaking must be based on sound 
science and there is a clear need for more information on the extent 
and nature of the ground water resources of the High Plains aquifer. To 
this end, we support further mapping, modeling and monitoring and urge 
expedited action towards enactment of S. 2773 by the 107th Congress, 
with assurances of close cooperation with state geologists and water 
resource agencies. Attached are suggested changes to S. 2773 that we 
believe would further improve the bill.
    Provisions of other pending legislation are still being discussed 
by our High Plains caucus, including those related to education 
assistance, research, and voluntary incentive based programs. Any 
federal actions, to the effective, must recognize the primacy of state 
water law and provide incentives consistent with state policies and 
programs. We look forward to working with the Congress to enact 
appropriate federal legislation, and working with the federal agencies 
to effectively implement legislative directives.
            Sincerely,
                                            Karl J. Dreher,
                            Chairman, Western States Water Council.

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